Forex Diary – 5-26-09

I wanted to start this diary seperate from my own personal diary entries.

Trading without Stops

I’ve heard, read, and have lost thousands of dollars from not applying this golden trading rule. Well, yesterday was my last time.  I want to state my emotional reasoning behind not using it to help others avoid this costly mistake.

First, I thought I could be saved by the overall strong uptrend in the EUR/USD. I also didn’t think the market would lose 200 pips. I was only going after 10 pips. I did have a limit placed on my trade. However, 10 pips never happened. I entered at 1.4019 and wanted to exit at 1.4030. I thought that it would eventually retouch and try to go even further (1.4100). Because of this, I stayed in the trade until I got a margin call and got closed out of my position. That was a $250.00 lesson on trading without stops again.