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If something is an improvement, it should be possible to prove that, right? So what is the logical conclusion?
Automated trading systems can trade on a 1 minute chart without missing a single entry signal. A human trader couldn’t do that. If something goes wrong with one currency pair, I can always adjust that one and still make a profit. If the other currency pairs do well, you could make a rule for the take profit, the stop loss, the number of allowed positions, the equity drawdown that you want to allow, and several more things that might come later. Do you like surprises?
I think actually most people would say yes. But indeed not all surprises are good. For most people a big potential loss is something totally unexpected and it messes up their minds. Most traders think that bad things will not happen because if something worked yesterday, it should work tomorrow.
You need to make a decision. Would you rather go with a higher drawdown or with a smaller profit? You might assume that it is not possible to ruin an account with $100,000 when you only trade positions with a position size of ten micro lot. And I can prove that it isn’t even difficult to do exactly that.
We love stories about heroes who survived risky situations. We admire those heroes, but I think we don’t want to face risky situations ourselves because this makes us feel bad.
I once wanted something that was able to trade 24/7 while I was away. I wanted something that would never get tired or bored and that could do it without breaking the trading rules.
We can find out in advance how we want to react in certain crisis situations by simply trading through similar crises from the past.
Most of the time I actually feel bad. I even feel bad when I make small profits because I think I could have made more. Imagine you can prove or disprove any trading idea you have in minutes.
Confidence comes from experience. And I still don’t understand why some people trade something that is based on a handful of trades.
I think discretionary trading is like car navigation with a compass. I think you would rather use the navigation system that already comes for free with your car or smartphone.
You need to define your own rules and stick to them. I have had a broker that was calling out something called close only mode whenever a certain market volatility was to be expected. That is when your broker simply forbids to open trades for one or several currency pairs.
I have done an extensive research for weeks to find the right broker for my needs, but yours might be different.
We want to avoid to lose money, that is for sure. We also want to avoid big drawdowns because that will make us feel bad.
So why do I like trading? Well, this is a topic I find interesting. I just like doing it.