Generally speaking, many traders lose money because they are not trading in harmony with the market. Harmony describes an agreement, accord, or balance between two parties.
But what does virtual trading in harmony with the market mean? Of course, many different factors can cause us to lose money in the market, but how can we pinpoint the exact reason we are losing money or perhaps not making as much as we would like?
As traders, we have to always trade in line with the fact that we cannot have 100% certainty of the outcome of any trade, even if it is an FTX token you are buying. However, you probably have not thought your trading strategy gives you a randomly distributed trading edge. In other words, your trading strategy will result in a random distribution of successes and losses, and rather than being afraid of this, and you must embrace this if you want to make money in the market.
It also means that you never exactly know if your next trade will be a success or a failure. The problem many investors and traders go through is that they often feel like their current trade will be a success, or they tend to ignore that they could lose the money they have risked on the trade. It could explain why a trader would bet more than they are comfortable with losing on a trade, trade without a stop loss, move a stop loss further away, etc.
Thus, if you have a fifty per cent win rate, for example, you still do not know which trades out of all will be a success or which would fail. Out of all your 100 trades, you could theoretically have 50 losses in a row and 50 wins, which could be very unlikely and yet possible. Unfortunately, most people do not always think this way when they trade. Instead, they get too caught up in their current trade and forget the fact that it is just a numbers game, and they have to continue to be disciplined and patient to see their trading edge pay off over an extended series of trades.
The main reason traders fail to make money in the market is that they fight natural outcomes of trades and try to regulate something that no one person can control; the market. We have the most control over our transactions before we enter the market and while we are setting up the trade parameters, much less is in our hands once the transaction is on.
The vital thing to keep afresh in your mind is that while you may have a high probability trading edge like price action, you still cannot know what exactly the market will do. Thus, it would be best to trade with this reality in your mind all the time. Otherwise, you might start to conjure up ideas and beliefs about the market that might seem very real and significant to you but irrelevant and nonexistent to the market.