After the close a new trader shared his frustration with stop outs in FCX. His solution: ignore his predetermined stops for if the stock traded against him (let’s call him MC Trader). This is how you end up at a new job.
MC Trader set a stop in FCX for 66c. FCX traded past this price but MC Trader did not cover. FCX went all the way to the whole and MC Trader did not cover. Then FCX came back to 61c and he did not cover.
MC Trader blasted his trading for not covering when FCX came back to 61c. I had a different take. I noted the problem was not covering when FCX hit his stop. MC Trader said, “But I kept getting shaken out of my positions so I decided not to cover.”
As a trader your goal is not to make money on a position. It is to control your risk. As an intraday trader the hardest part may not be figuring the direction of the stock but the direction of the stock and its pattern. And sometimes you pick the direction but not the pattern—and you get shaken out.
A dangerous and unprofitable solution long term is to adapt as MC Trader did and not cover. The correct solution is to get better at deciphering the direction and the pattern while always controlling your risk. What will you do when that stock goes above 66c and never comes back? That will be a mega loss, which will tear up all of your prior gains and then some. You will be risking your day on a trade that is not working for you. First control your risk.
You can be better tomorrow than you are today!
No relevant positions