We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Mixed
USD/JPY
Mixed
Gold
Bullish
Oil - US Crude
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Bitcoin
Bearish
More View more
Real Time News
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 96.91%, while traders in Germany 30 are at opposite extremes with 83.79%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/jYqUyArf3u
  • AUD/USD Technical Analysis: Aussie Dollar May Break Range Floor - https://www.dailyfx.com/forex/technical/home/analysis/aud-usd/2020/02/18/AUDUSD-Technical-Analysis-Aussie-Dollar-May-Break-Range-Floor.html?CHID=9&QPID=917708&utm_source=Twitter&utm_medium=Spivak&utm_campaign=twr #AUDUSD #technicalanalysis https://t.co/6aeywJkAkR
  • Forex Update: As of 05:00, these are your best and worst performers based on the London trading schedule: 🇯🇵JPY: 0.13% 🇨🇭CHF: 0.04% 🇬🇧GBP: -0.04% 🇨🇦CAD: -0.10% 🇳🇿NZD: -0.29% 🇦🇺AUD: -0.32% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/XfJ4dACKNd
  • Indices Update: As of 05:00, these are your best and worst performers based on the London trading schedule: Germany 30: -0.47% US 500: -0.49% Wall Street: -0.53% France 40: -0.55% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/bowwGbbxZe
  • Cash rate futures are pricing in about a 52% probability of an #RBA 25-bp rate cut at the June interest rate announcement -BBG $AUDUSD
  • The #Euro may have more room to fall versus its major peers such as the US Dollar, Japanese Yen and British Pound. What is the technical picture of $EURUSD, $EURJPY and $EURGBP - https://www.dailyfx.com/forex/technical/article/special_report/2020/02/18/Euro-Weakness-Risks-Accelerating-EURUSD-EURJPY-EURGBP.html?CHID=9&QPID=917702&utm_source=Twitter&utm_medium=Dubrovsky&utm_campaign=twr https://t.co/DyuPCusTCh
  • #NOK, #AUD and #NZD are expected to be the most-active #G10 FX versus #USD with one-week implied volatility at 7.15, 6.76 and 6.70 respectively [delayed] -BBG
  • Commodities Update: As of 03:00, these are your best and worst performers based on the London trading schedule: Silver: 0.64% Gold: 0.34% Oil - US Crude: -0.84% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/YvrO2r6JzE
  • Forex Update: As of 03:00, these are your best and worst performers based on the London trading schedule: 🇯🇵JPY: 0.17% 🇨🇭CHF: 0.04% 🇪🇺EUR: -0.03% 🇨🇦CAD: -0.13% 🇦🇺AUD: -0.36% 🇳🇿NZD: -0.37% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/3NzfCsQ13V
  • LIVE NOW! Senior Currency Strategist @IlyaSpivak discusses the technical and fundamental $AUDUSD outlook for the week ahead here - https://www.dailyfx.com/webinars/378612179?CHID=9&QPID=917720&utm_source=Twitter&utm_medium=DFXGeneric&utm_campaign=twr
Every Trader's Most Common, Costly Bias

Every Trader's Most Common, Costly Bias

2013-10-18 21:07:00
Research, Research Team
Share:

Talking Points:

  • The “#1 Account Killer” for Traders
  • How to Leave Opinions Out of it

In trading, even a viable plan is no guarantee of success. We all need to realize upfront the cost of not being patient and disciplined before coming to the realization that the method is not the problem, we are. A wrong thesis can easily lead to unnecessary drawdowns, which occur regardless of whether or not you have sound method, but there can be a simple solution for avoiding that problem.

Always Beware of a Thesis

Having the wrong thesis is perhaps the number-one account killer for traders. More often than not, a person has a predetermined opinion about what a market is going to do before even viewing that market through the lens of an objective methodology. No matter how good the trading method, someone who believes they’re right about the future direction of a market is only going to heed the method when it agrees with their opinion. Of course, this is backward thinking.

Traders should always heed the method, even if that requires taking trades that are in total disagreement with their thoughts and feelings about the market. The real danger here is allowing the desire to be right to overshadow the danger of losing money. It is far better to have your opinion proven wrong and make money than to hang on to a belief and lose money, especially in a margined account.

We routinely talk about bearish long-term weekly patterns in EURUSD, but more often than that, we highlight shorter-term buy signals in that very same pair.

See related: Perfectly Good Set-ups Many Just Let Slip Away

Benchmark Your Trades

The key to avoiding the dangers of an ill-timed opinion is to benchmark your trades. Keep track of all of live or demo trades in a spreadsheet and rate each trade in terms of how close you came to following your trading plan to the letter, with a 0 or 1 indicating you did not stick to the plan and a 5 meaning you followed the plan exactly.

Be honest with yourself and record every trade on the spreadsheet. At the end of each week or month, go back and see your overall performance and the scores of your individual trades. You will quickly discover where your problems may lie and may then determine how to adapt in order to produce better results.

There is an old saying that we “buy on fear and sell on logic.” Be aware of this, particularly if you have strong beliefs about politics and/or the economy. It’s too easy to base a market thesis on either of those factors, and the more powerful the belief, the harder it will be to maintain objectivity in the markets.

Next time, we will cover the dangers of “ownership” and the inability to follow orders.

By Jay Norris, author, The Secret to Trading Forex, Futures, and ETFs: Risk Tolerance Threshold Theory

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.