It’s important to be uncomfortable if we want to be great traders. It is also important to find ways to trade against uncertainties. To accept that no one has a time machine or a crystal ball means we can’t know what the future will be. We can only take our chances and manage the risk we have now. In order to be a good trader, you need to know about the psychological chart patterns and market trends that other traders made when they were afraid or excited. We get paid for taking on risk and trading against new traders who make bad moves, and that’s where we get our money back.
Here Are Ways to Trade Against Uncertainties
- We don’t know if each trade is going to be a winner or a loser, so we have to depend on the stop losses, trailing stops, and profit targets tell us when to get out of the market.
- We have to take our chances and let the markets decide what will happen next, then.
- So we have to trade today’s price action. The future doesn’t exist, so we have to trade what’s going on now.
- Whether the next deal is going to make us lose money, make us money, or make us money is unknown. But we can make sure that it isn’t a big deal.
- We don’t know what will happen next To trade a large amount of money.
- There can be any kind of change in the markets at any time. We have to be ready to deal with that, and we have to accept that.
- On any single trade, we should never risk more than 1% of our trading capital. This way, if the market makes a big surprise move, it won’t hurt us very much.