Knowing when not to trade
Knowing when a potential trade is being set up is undoubtedly important to your success trading any market, whether it is foreign currencies, commodities, futures, stocks, or options. But perhaps more critical is learning when not to trade.
Why? Because you can easily set back days of trading success in just a few minutes. Knowing when to trade can make you some serious profits. Knowing when to stay out of the market, however, will keep your hard-earned profits ready to trade another day.
Sometimes it’s frustrating to sit out the market, but it’s much better to take the day off and preserve your gains than jump in trying to chase performance and lose it all. Wait for trends and patters to be set up. Wait until you’re confidence in the trade is high. Entering trades when you shouldn’t just leads to a lack of conviction, and will just whiplash and discourage you.