6. Lack Of Confidence Archives

Good Strategy For Trading Success


This is a trader question from the Fibonacci Trading Forum.

Vernon says:
What would make the biggest difference to my trading?
Combining the top-down analysis and finding an entry in the lower time
frame based Higher High or Higher Low and TRSI with Fibonacci.

Neal’s reply;

That’s a good strategy!

So, make it happen, find the setup, wait for confirmation, execute the trade, manage it, and exit..

Try to ignore the profit motive for a while. Whether you are trading the TRSI Bounce, TRSI Pop & Drop, TRSI Push, or any other strategy, focus first on keeping the risk within your tolerance. After some experience, you can analyze the results and make revisions to optimize for profits.

-Neal Hughes “FibMaster”.

Vernon says:
I also need suggestions for the following;
Building confidence and trust in the analysis and pulling the trigger
based on the price action, Fibonacci and TRSI.

Neal’s reply;

Confidence requires time and consistency, it needs to develop. Time and experience are part of the recipe, they are necessary ingredients.

There is no way to become confident without following a consistent strategy. Then apply the strategy consistently over many trades, and measure the result. You can speed up the process by analyzing past charts, as well as executing your strategy in live trades.

With experience and consistent diligence, you can develop confidence in your strategy. Start small, with lower risk, then adapt as your confidence builds.

-Neal Hughes “FibMaster”.

Fear, Greed, Managing Emotions While Trading


This is a trader question from the Fibonacci Trading Forum.

Justin says:
I need to develop trust – once I do the analysis, find an entry point and make the trade – I don’t trust the levels I’ve come up with and pull the trigger to exit right when it starts to go against me.

Neal responds:
It seems that you do not trust your entries? Or are you nervous about taking a loss?

There are two issues that come to mind… The first is the distrust of your triggers. The second is the question of how much room you should allow a trade to go against you, before it continues to your profit exit.

Traders who distrust their triggers should study past trades, and keep a log of current trades. Work to determine whether the trigger has a positive result over time. If you had not distrusted the trigger, and allowed the trade to continue, would it have been profitable? How many times would it be profitable vs unprofitable? Perform this analysis on historical charts, and current ones too. Calculate some statistics, and also plan a viable exit strategy on the losing trades. If you trust your ability to exit bad trades with a controllable risk, you may have less urgency to exit quickly.

On the topic of allowing a trade some room to move, we should discuss that in one of our live webinars. Since we are generally entering when a trade is moving in the right direction, we don’t want to allow too much of a move against our position, but some risk is inevitable.


Pulling The Trigger


This is a trader question from the Fibonacci Trading Forum.

Martin asks:
I seem to be waiting for the optimum trade and then do not pull the trigger, but then see it go the way I thought it would.

Neal responds:
There are several primary causes of this problem;

Lack of confidence.
Over analysis/indecision.

We’ll discuss this in a future Fibonacci Trading Forum webinar.

-Neal (FibMaster’s Fibonacci Trading Course)