The 7 Deadly Sins of Trading — And How To Overcome Them

From E-MiniWatch.com:

Remember the 1995 movie Se7en with Brad Pitt, Morgan Freeman and Gwyneth Paltrow? A serial killer is on the loose, picking his victims because they represent the worst of human behavior – the Seven Deadly Sins. There are murders to punish Greed, Gluttony, Sloth, Lust, Pride and finally Envy and Wrath in the final scene.

Well, when it comes to trading, I’ve got my own list of worst trading behavior – my own 7 Deadly Sins of Trading if you like:

1. Trying to pick tops or bottoms (“Billy, Don’t Be a Hero” playing in my head)
2. My gut says we’re going to break out (Professionals love fading breakouts)
3. No confirmation from my Volume indicators (wait for everything to line up)
4. Hesitating on entry (typically when the trade is “hard” to take)
5. Canceling my stop (OMG, the biggest Sin of them all!)
6. Moving my profit target (got to let the winners run)
7. Letting a profitable trade turn into a loser (luckily, a rarity)

Continued

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