Why 90% of Retail Traders Fail - "Fear of Missing Out!"
There are so many reasons why 90% of retail traders fail. One of the main reasons is because retail traders over trade. They fear missing an opportunity and because of this they think there is always an opportunity when in reality there isn't. As traders, it is our job to find high probable setups. Probable setups are limited though... so you need to have patience to wait for them to unfold.
All too often I see traders here chasing price, and this EURUSD today is a perfect example of this. I can't even imagine how many traders got short on the break out of this short term up trend line. Many probably waited for the hourly candle to close to enter, but what happened? Immediately after they entered price reversed sharply and is on the way to stopping those traders out who most likely have their stop loss just above the high around 1.047.
If we look at the price action over the month of December on this pair, we can clearly see the 1.05-1.052 area have been strong support where buyers continuously stepped in every time price approached it. Once that support was broken you can see that the role of the level reversed and it became resistance. Sellers came in on the back side of the level, however only intraday did it retest the level. It is likely that there will be an official retest of the figure and another major attempt to the downside, even if it is just to the previous low.
IF price comes back to a major area that was support it will VERY LIKELY become resistance. A setup like this is a high probable setup, but it takes a while to unfold. It has been 6 days so far since the level has been broken. Maybe it will hit the level today... maybe not. Maybe it will hit the level tomorrow... maybe not. Maybe it will hit the level next week. Maybe it will NEVER come back to the level... Who knows... but as traders we must be patient if we want to get the most probable setups.
It is better to miss a trade than to take a poor trade!
If you want to get setups that have low odds of working out, that is fine. You do you, but if this resonates with even one trader and helps them trade better than my job here is done.
All too often I see traders here chasing price, and this EURUSD today is a perfect example of this. I can't even imagine how many traders got short on the break out of this short term up trend line. Many probably waited for the hourly candle to close to enter, but what happened? Immediately after they entered price reversed sharply and is on the way to stopping those traders out who most likely have their stop loss just above the high around 1.047.
If we look at the price action over the month of December on this pair, we can clearly see the 1.05-1.052 area have been strong support where buyers continuously stepped in every time price approached it. Once that support was broken you can see that the role of the level reversed and it became resistance. Sellers came in on the back side of the level, however only intraday did it retest the level. It is likely that there will be an official retest of the figure and another major attempt to the downside, even if it is just to the previous low.
IF price comes back to a major area that was support it will VERY LIKELY become resistance. A setup like this is a high probable setup, but it takes a while to unfold. It has been 6 days so far since the level has been broken. Maybe it will hit the level today... maybe not. Maybe it will hit the level tomorrow... maybe not. Maybe it will hit the level next week. Maybe it will NEVER come back to the level... Who knows... but as traders we must be patient if we want to get the most probable setups.
It is better to miss a trade than to take a poor trade!
If you want to get setups that have low odds of working out, that is fine. You do you, but if this resonates with even one trader and helps them trade better than my job here is done.
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