Kardec Trader warns beginners against revenge trading after a loss. Instead, reduce your position size, write down what happened, treat the loss as a business expense, and start fresh the next session with lower risk.
Especially if you are a beginner and you are just getting started, what will typically happen is when you lose money, the first thing that pops into your brain is, I need to make this money back. I need to go and I need to make the $10,000 I lost. And you go in and you go in with the bias. You go in being super aggressive, you go in with just trying to make that money back. The way to overcome that is size down. Write down your thought process and what the market is telling you and you have to let go of that losing trade or day. You have to let go of it. You have to say, I took a loss, it's a business expense, now write it off and I'm going to move from it. Until you feel like you've moved on from it and you let it go, it will bleed on to your next trading day or next trading session or whatever the case is. So you have to get yourself to a point of letting go of that day, letting go of that trade, and starting the day with the brand new slate and reducing your risk. So if that does bleed in, your loss won't be substantial.
