I Lost 10 Trades In A Row...What Now?

You have read the title correctly, I have lost 10 trades in a row. That sounds soul crushing, and for some traders in their early stages of their trading career, it might well be. But for me…no biggie. 

I don’t say that to gloat, or to sound impressive. I say that because I have come to peace with trading and know that losing is part of the game. 

Do you want me to really hype myself up? Well those 10 losers make up less than 1% loss in capital. 

Now that is something I say with pride. If you were speaking to me 6 years ago I bet that would be me sitting in a 10% drawdown on my trading account. Feeling like I have a mountain to climb to get out of the hole I have just dug myself. Not only that but I’d probably have some emotional trauma coming over me and I’d need a good couple of weeks off. 

But me today, that isn’t the case. 

I am going to show you why and how you can transform yourself from being a trader that doesn’t cut losing to trades, to one that does. Someone that isn’t afraid to take the loss and use it as a tool to learn and grow, rather than seeing it as a huge failure. 

If I were to speak to someone who is just starting out on their trading journey and I told them I had just lost 10 trades on the bounce, they would probably think I am an amateur too, and I wasn’t worthy of listening to. 

The market has been flooded with the wrong information, the get rich quick schemes, the need to be correct all the time to make significant money in this field. But that’s not true. Yes some people get ‘lucky’ and they hit on something, use inappropriate risk and make a quick buck, but these are outliers. 

Being consistent and using time to your advantage is the skill to make gains in the markets. These days we have access to prop firms that give us the opportunity to trade with larger capital. 

So how do I cut losses early? 

Let me give you an example. 

I was recently long EUR/GBP following my trading strategy. My strategy involves identifying strong and weak currencies via my currency strength meter and macro trend analysis. I highlighted the potential for EUR/GBP to trade higher. 

The next step is to identify when to trade using a process of looking for what I call the secondary phase of the trend, turning into the primary phase via a lower time frame change in trend. This strategy helps me get in at the bottom of a trend most of the time. But sometimes it doesn’t work, either data changes or the narrative and the trade moves towards my stop loss. 

I use ATR stop losses, specifically 1.5x daily ATR. This gives the trade lots of breathing room, but also allows me to cut the trade if it starts to change. 

As the trade develops we get more information, so if the lower time frame reverses back in the opposite direction, let’s say it goes from making lower lows and lower highs, to making higher highs and higher lows. That tells me the trade may not be working out and I close the position early. 

I then go on to track the trades performance, whether it goes to full stop loss or full take profit. This lets me know if cutting the trades early is worth doing. 

Out of my last 10 trades 8 of them went to full stop loss, this would have caused me to lose more of my trading capital. It also showed me that cutting the losses early helped me lose less, preserving capital. 

When you get into the habit of doing this you find yourself holding on to winners because the trend remains intact and cutting the trades when the trend changes. 

Try this out on your next trade, or at least try it on a demo account first, take a position in line with your strategy and when the conditions change, close the trade. When you build up a number of trades and evidence proves this works, you will be able to make peace with losing in the market. 

Remember the goal is to lose less capital.