This morning I was stalking Paramount (PARA) looking for it to bottom out and buy it.
I first tried to buy it at $17.80 with 2000 shares on. Sadly, it rolled back over on me and I was stopped out for a loss.
Then, I tried to do it again and tried to buy it at $17.00.
The difference here is I waited until it popped back up...
But I only had 200 shares on.
And wouldn't you know it, the trade worked.
Eventually, it would get all the way back to $18.00, but I was mad.
Why?
Because my first loss completely eclipsed my next win because I didn't put on shares.
This is where I started to make mistakes.
My anger got the best of me, and I started to just trade for trading's sake. I chose to try and buy PACW, a stock that hasn't ever worked out for me in the past, I and lost more money.
While others in the Warlock's World were making money hand over fist from buying PARA at $17.00 and selling at $18.00, I kept on losing more and more money.
And I was pissed. Livid. Absolutely beside myself.
But you know what I did then?
I stopped trading. And I let myself calm down.
My brother 8ball came on, and he essentially became my trading therapist.
His analysis helped me get a clearer head. And his words of wisdom rang true.
Click here or the video below to see what he had to say...
So what can we learn from today?
I'd say you can break it down to three main takeaways...
1. Keep Your Position Sizing Consistent
I had my risk-reward in my favor, but I got way too cautious on the second trade.
I put a tenth into the second trade as I did the first one. That killed me in the end.
2. Trade What Works
PACW has been an awful stock to trade with it getting halted every five minutes, news making the stock tank, and just never worked out for me.
Why did I trade it? Because I was angry, and I was on tilt.
Which brings me to my final point...
3. Never Trade on Tilt
You need to take all emotions out of trading.
If you're seeing red, have a headache, are distracted or just aren't on your game, stop trading.
You need to be sharp, quick, and tackle trades as you see them.
I could have been up today even with the two losses I had.
That final leg up on PARA would have been my day's pay, and I could have left for the day.
Members of the Warlock's World, while entertained by my misery, let me know that they got into PARA and properly made their money.
And if you want to be a part of this every day...
You can join me now by clicking here.
The post A Lesson on Exactly What Not to Do When Trading appeared first on This Is VWAP.
About the Author