This article is from the most excellent SMB blog:

“If I increase my stop then I will start making money.”

This just might be the single silliest thing I have ever heard a trader say. No “trading is in my genes” is.

I will offer a path to profitability to consider. Look there is no one right way to achieve your goal but there are definitely wrong paths. Adding risk when you are losing money is such a path.

I was talking to a group of trainees recently about the power potential of building from a positive base. If you can create a PlayBook of profitable set ups that make sense to you then there is so much to work with with this trader. If you are just losing money week after week there are many issues that need resolving before we can even construct a PlayBook.

Impatience. Overtrading. Lack of discipline. Work Ethic. At one point I went so far to proffer that believing you can go from consistently negative to decidedly positive is delusional. How about first just stop losing money?

Michael Martin wrote in The Inner Voice of Trading that you are not going to be great at this game called trading for many years so you might as well enjoy the journey. In the unpublished paperback of Denise Shull’s Market Mind Games she talks about reality of one technique being gamed out of the market and the psychology of finding that new edge. The single greatest failure in trader education just might be the unwillingness of teachers to share realistic learning curves. As Dennis writes even when you get “there” what do you really know. So where are the new and developing traders think they are going so quickly?

Skill survives. Trading plays come in and out of favor. We all do not know all that much about the markets, even after 12 years of trading, since the data is always changing. With all that then isn’t it best to pick a path that is most responsible. Think about this path”

  1. Lose money
  2. Lose less
  3. Flat
  4. Slightly positive
  5. Find more plays that make sense to you
  6. Build from this positive base
  7. Focus on getting bigger in the plays that make the most sense to you.

Very well said. My favorite bit is “Work Ethic”.