So I guess to kick this blog post off, I should define that I am a classical trend follower in terms of my trading method and that I trade a lot of different markets (beyond just stocks). I don’t do anything particularly fancy in determining trends. I select an entry and exit point and get in the trade.
Why’s this relevant? Well, this post is just a rant about trend reversals and how to deal with them. As I write this post, it’s after the US Markets close on Saturday 20 March 2021, which, as some traders will know, is a triple witching hour day. This means that volumes can be higher than usual, which can create some counter-trend movements.
For me, this resulted in my portfolio swinging by around 1.5%, and most of my current trades moving against me (most are relatively newly opened trades), which is frustrating, to say the least. I still dislike giving back open profits, which I think is one of the most challenging trading psychology elements for a newer trader to overcome.
So how did I deal with this when I looked at my portfolio this morning?
Well, I did a couple of things which I’ll outline:
That’s it for now.