It Could Have Been You

Posted on Jan 15 2015 - 8:08am by Sharpe Trade

I personally trade Forex for my own accounts.  However, we here at Sharpe Trade we focus on equities.  Stocks.  ETF’s.  Options on Stocks.

Regardless, I want you to take a look at the Forex cross of AUD/CHF this morning.  This was a cross I was trading in the Stocktwits stream.  As I said a few days back in that stream, I had it long, and was in a great move.  And then, as stated, I was completely out of the trade, with a stop that was in place.  And again, this is something I want you to take a look at. Because there is a vital lesson here 

AUD/CHF – Daily Chart

AUDCHF Swiss Franc

Overnight, the Swiss just gave the Euro … … well an obscene finger gesture.   It appears that they are bailing on the ol’  Euro party.

There was no innate genius in my exiting my long position folks.

Some of it was dumb luck.

Much of it was general, boring, usual trading principles that we repeat over and over and over and over again.

Remember this when you look at that chart.

That could have been you.

Forget looking for “trading signals”.  Forget what “technical” move says.  Forget that nonsense.  Who cares.  There ain’t a technical OR fundamental tool on this planet that told you the violence of that move was on the way.

This is why, after the 1,000 point drop in equities on May 6, 2010, I said that you have to know the table at which you sit.

This is the market folks.  Again, this is the table at which you sit.  This is why position sizes, stop losses, and knowing how much you can lose is so important.

Someone without a stop loss, and that was leveraged long … woke up this morning long, and is just … vomiting.

As I said in one of the above podcasts, there is nothing funny about that.  Someone didn’t know those lessons, and someone is hurting this morning.  Badly.  This has nothing to do with gloating.  This is a lesson.  let it be your lesson

That could have been you.

This is why … you never …

Ever

EVER

EVER

… turn your back on the market.

Those guys that shuffle along:

“Oh … it’ll be ok.  And that Dan guy, he says to trade too  small.  That John guy, and that Tom Sosnoff guy who says trade long term positions small, and that Robbie guy, they talk about risk management.  Those guys are dumb.  You can’t ever make any money that way!  You have to trade LARGE!

It’ll be ok.

It’ll be alright.

Nothing bad will happen”

Those guys?

Those guys may have lost their house and cars this morning.  If overly-leveraged?  There is nothing funny about this … but it’s also the sort of morning where they do something more … dire … to themselves.

Seriously.

This is the sort of situation where that happens.

Let this be your lesson.

We’re not joking around when we talk about risk control.

You could have lost $50.00 on that chart.

Or you could have lost everything you own and more.

Let this be your lesson … because that could have been you.

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