How to End a Losing Streak

As a beginner, there will come a time when your trades crumble and fall apart. For you, everything is in the right place, you did your research, and probably wrote down a plan to steer you through profitability, but the Market seems to be in a bad mood every time you make an entry. Your system worked before, so why isn't it working now?

Disappointing trade performance, more often than not, is the result of the trader not sticking to his guns or unintentionally sabotaging his plans in a desperate attempt to make profit. The first thing that you should do you is evaluate your performance objectively. Going back to your trading log will provide you clues, and may even identify a pattern. You can't control the market, you can only adapt to it. Know if your trading system is not suited for the current market conditions. It can be highly volatile, so trading systems can experience a period of drawdown. Evaluate if your trading plan is actually profitable. No matter how good your entry is money management will determine a profitable exit. You always need to earn twice to cover your previous losses.

Apart from looking into your system, you should also look into your condition. When you're under financial stress, its easy to click around and go panic buying and selling. The mental and emotional state of a trader can easily influence him, especially if its about money.

Your best bet is to clear your head and take a step back to see how you've been trading. Chances are you already know what's wrong, you just need to see it clearly.