Once upon a time, in a realm where battles were fought with sticks instead of swords, there existed a peculiar war unlike any other. Picture a vast battlefield where warriors of all ages and sizes clashed, armed with sticks of various shapes and sizes.
In this extraordinary battlefield, there stood a dome at the entrance, housing an assortment of sticks for the warriors to choose from. The goal was simple: collect as many sticks from fallen foes and bring them back to the war room for honor and glory.
Now, let me introduce you to our protagonists: a brawny young man and a wise elderly gentleman. As they entered the dome, their choices couldn’t have been more different. The young man, muscles bulging and eagerness in his eyes, grabbed the largest stick he could find. Meanwhile, the elderly gentleman, with a calm demeanor and a cigarette dangling from his lips, opted for a humble, lightweight stick.
As the battle ensued, the young man charged headlong into the fray, brandishing his hefty stick with gusto. But alas, his enthusiasm proved to be his downfall as he was swiftly overwhelmed by a gang of nimble children wielding sticks half his size. Down he went, defeated by the unexpected agility of his adversaries.
On the other hand, the elderly gentleman took a different approach. With patience and precision, he observed the battlefield from afar, waiting for opportune moments to strike. Spotting weakened opponents, he moved in with calculated strikes, effortlessly collecting their sticks while avoiding unnecessary skirmishes.
As the battle raged on, the young man lay on the ground, nursing his bruised ego, while the elderly gentleman continued his steady advance, accumulating a trove of enemy sticks with each encounter. Despite his initial skepticism, the young man couldn’t help but marvel at the old man’s strategic prowess.
In the end, it was the elderly gentleman who emerged victorious, his bag brimming with sticks of all shapes and sizes, including the hefty one wielded by the defeated young man. As he strolled back to the war room, puffing contentedly on his cigarette.
Now, if you’re still pondering the essence of this tale…
We often hear that “patience is the key” in the markets, but it sounds so cliched that this advice can seem trite until we’ve endured our fair share of setbacks and trials. How many times have we eagerly jumped into trades, signaling a good breakout of that inverted head and shoulders pattern or the breakdown of that double top or triple tops at the first sign of opportunity, only to watch them swiftly turn against us, stopping us out before reversing course? Sound familiar? It’s a frustration shared by many, leading some to lament that the markets are rigged against them.
Consider this: we spot a promising pattern like a Morning star or a Hammer candle at a key support level, and we’re quick to dive in, only to watch the price plummet further, stopping us out once again before eventually reversing. It’s disheartening to feel so close to success, only to end up losing money in the end.
The “honcho” in the above story represents none other than the inexperienced retail trader, who, regardless of their capital, is prone to losing out until they learn to patiently wait for the best possible entry and exit points—a skill honed through experience.
So, how does one cultivate such patience? While I’m certainly no expert, I believe it’s a combination of time and experience. But, when you feel the urge to jump into a setup, pause and ask yourself, “Can I enter with just a portion of my capital—maybe 1/3rd or 1/2—and then scale in if I’m proven right?” At least you would lose less than if you had gone in full guns blazing.
Perhaps I’ll delve into this topic further another day. Until then, keep trading, keep learning, and remember: patience may be a virtue, but it’s also a skill that can be honed with practice.
Additionally, please share any instances where your patience has led to either profit or loss. By sharing these experiences, we can collectively grow and learn from one of the most underrated virtue in trading: patience.
Ciao adios!!
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