The trade everyone thought was safe… until it wasn’t.
I’ve been there more times than I’d like to admit. I had this experience, it was two years ago, staring at the CPI release. I had a 7-trade winstreak going, confidence through the roof. Then I hit two losses in a row. My rule said shut it down after two losses. But the setup was still flashing, and my emotions were boiling. I told myself I’d trade a bigger lot size just to breakeven. That’s when everything unraveled.
It was traumatic and the lesson was learned the hard way.
That sting doesn’t go away quickly. But over the years, I’ve built a set of habits that keep me from turning one bad trade into a pain trade spiral.
Here’s what I learned from that experience:
1. Anger Was the Trigger
Losing twice in a row wasn’t the end of the world. What killed me was the anger that followed. I felt cheated, like the market “owed” me. That mindset flipped me from patient trader into reckless gambler. Once I clicked that oversized order, I wasn’t trading the setup anymore, I was trading my frustration.
2. Greed Made It Worse
I convinced myself bigger lot sizing would erase the pain. “Just one win and I’m back even,” I thought. But greed doesn’t fix mistakes, it compounds them. When slippage hit during that CPI print, my risk wasn’t just doubled,it was blown out of proportion.
3. A Streak Doesn’t Protect You
That 7-trade winstreak gave me a false sense of invincibility. I thought I’d “earned” the right to push harder. But markets don’t care about streaks. One bad decision can wipe out weeks of progress. That night, all seven wins vanished in one ugly red trade.
4. The Emotional Spiral Is Real
In a matter of minutes I cycled through every trader emotion: anger, greed, desperation, denial. It was a roller coaster, and none of it helped me think clearly. By the time the position closed, I wasn’t even reacting to price action anymore, just raw emotion.
My Takeaway
That night taught me the hard way: rules matter most when you least want to follow them. Two losses should’ve meant I walked away. Instead, I let emotions steer, and the cost wasn’t just money, it was confidence, discipline, and weeks of progress.
The pain trade isn’t just about one bad setup. It’s about the moment you let anger and greed drive your decisions. I learned the lesson the hardest way possible: if I don’t shut down after two losses, the market will do it for me.