When was the last time you got a paper cut? Do you remember? I\u2019d bet you struggle to\u00a0come up with the time and place. Exactly, you forgot.\u00a0Keep your losses like paper cuts so you can forget about them and continue\u00a0working. Paper cut losses are simple, effective and essential.<\/p>\n
Novice intraday traders need to understand the importance of taking paper cut losses. They\u00a0will protect your account and psyche from damage. Small losses allow you to focus on\u00a0the next trade without influence from the previous trade. One Good Trade to the next\u00a0One Good Trade.<\/p>\n
Paper cut losses can prevent the common pitfalls of revenge trading\u00a0or trading your P&L from creeping into your trading day. Losses that more resemble hitting\u00a0your thumb with a hammer are much tougher to forget. Taking losses is an everyday\u00a0occurrence in the life of an active pro day trader, they must not trigger, self sabotage\u00a0stress induced decision making.<\/p>\n
The great thing about paper cuts are that they hurt for a second, but the pain ends quickly\u00a0and you can get right back to work. As your tape reading and foundational trading skills\u00a0improve your personal definition of a paper cut loss will evolve. What may start as a\u00a0simple small, dollar loss position sizing strategy should progress into trading bigger\u00a0positions with a better ability to keep them and derive more profit from them while maintaining a paper cut mentality.<\/p>\n
Jeff Davis<\/p>\n","protected":false},"excerpt":{"rendered":"