Wiping out the Trading Account
Most successful traders failed at some point in their careers and wiped out their account. Many traders lose because they do not understand the nature of the decision-making process, which should be based on rational price action analysis versus emotional, irrational reactions to price action. A reason should be required for each market action taken. When fear exits a trade, it is more difficult to take the next technical signal. Traders will eventually become confused and feel guilty from indecision. Do successful traders buy an education with the mistakes they make?
What separates the winners from the losers is that they learn from mistakes, refine the decision-making process, keep on trying and never give up. If traders cannot accept the losses that go with the trading, they do not deserve the profits. Failure is the greatest teacher only when a student is prepared to learn. If the student has forgotten previous lessons, or the dog ate his homework, he is not ready. A positive attitude has positive expectations of future events and normally precedes the success it creates.