Forex Trading Tips – Forget Everything I Said

By Boris Schlossberg • February 19th, 2010
Boris Schlossberg

Forget Everything I Said

Last Thursday I put out an article entitled “EUR/USD at 1.3500 – Just a Matter of Time?” It was written before the Fed Funds rate hike announcement so it was far from a foregone conclusion. The article spurred a flurry of responses with some readers agreeing with me and but most calling me a idiot who clearly didn’t understand how grossly oversold the unit was.

One particular gentleman took the trouble to point out all the factual mistakes I made (from improperly labeling the yearly low for the unit to not recognizing the fact that the euro r had made a higher low on daily basis for the first time since January which was clearly a bullish sign). His arguments were compelling and to an objective eye he may have been more accurate in his analysis.


Later that day of course, the Fed sprung its surprise Fed rate hike on the market and all hell broke loose. The euro dropped like a stone hitting 1.3500 within ten minutes of the news. That same gentleman then posted only one line to the thread -- “Forget everything I said.”


————--Top 5 Stories in FX This Week—————-

As Greece Burns, Hazards Remain in the U.S.

Greece or California: Who’d you Rather be?

Wall Street’s Bailout Hustle

Fed Chooses to Exit Through Eye of Needle

Europe’s Slowdown Would Only Nick US


When I saw that comment I couldn’t help but smile because I thought it captured perfectly the nature of trading. No matter how many years you’ve traded, no matter how much price action you’ve seen, you always come across a “Forget everything I’ve said” moment. Markets like life will never fail to surprise you. If they didn’t, trading would be as easy and predictable as a government job and just about as rewarding.

Alas I wish there was an easy antidote to those moments of crazy volatility but there is not. The only remedy is experience. You have to blow up a few times before you learn to control your emotions. Jack Schwagers book is littered with examples of world class traders blowing out their accounts repeatedly before finally mastering that lesson.

However, having a contingency plan for your trading much like companies have for their business at least helps you to be aware of the problem. Next time a “Forget everything I said” moment hits you – ask yourself do I really want to trade this event? Or should I step away to come back and fight another day?

 

Leave a Comment

« | Home | »

Trader Education Live Session Schedule

Everyday at 9am ET/ 13 GMT

  • Monday Morning Game Plan
  • Technical Analysis Tuesday
  • World Markets Wednesday
  • Strategy Think Tank Thursday
  • Trader Therapy Friday
Join Today
Trade Results
BORIS
Trade Like a Traveler Not A Tourist – Part 2

August 15, 2014 • by: Boris Schlossberg

Trade Like a Traveler Not A Tourist

August 8, 2014 • by: Boris Schlossberg

see all posts by Boris Schlossberg
KATHY
EUR/CHF Drops Below 1.21 – First Since Jan 2012

August 15, 2014 • by: Kathy Lien

Forex: 10 Events to Watch Next Week

August 15, 2014 • by: Kathy Lien

see all posts by Kathy Lien

Past performance is not indicative of future results. Trading forex carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade any such leveraged products you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading on margin, and seek advice from an independent financial advisor if you have any doubts.

copyright notice | terms of service | terms of use | website policy