The Right Mindset
Human beings are emotional creatures and discretionary approaches allow those emotions to creep into your trading. Whether it’s greed, fear or frustration resulting in revenge trades or other irrational decisions…it’s simply a recipe for losses.
Knowing a trading approach’s historical results ahead of time prepares you for the trade / investment. A simple example would be a 200 bar moving average crossover. Knowing I will buy on cross up and sell on cross down gives me freedom.
I can also back test this. Either officially through Tradestation or Tradinview. Or, simply going back through the chart for the prior 15, 20 or 30 trades and tabulating the “numbers”. I will talk about the “numbers” in later posts.
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