When 💩 hits the fan...

[sana54210]

When 💩 hits the fan...

I woke up this morning to find the ceiling in my bathroom raining. Happy Monday, world. 💦

It turns out that when property management installed new toilets 🚽 in all the apartments this weekend, they screwed up installing one in the apartment above mine. Hence the water coming out of the ceiling and the vents.

While I waited for the plumber to come repair 🔧 things, I made a couple trades and it had me thinking about what a trader needs to do when shit hits the fan.

Not every trade goes the way you expect it to, and sometimes it goes sour in a spectacular way. 🎇

When stop losses get blown and people are market selling left and right, what do you do?

Don't panic! ‼️

Panicking leads to poor decisions based on emotion, not on logic. 🤖

Instead, take a breath and evaluate the situation. The goal is to get out of the position as quickly as possible, with as little slippage as possible, while minimizing any further risk.

Depending on your strategy and the trade, sometimes the best decision is to simply market sell and get out ASAP, while sometimes you can get away with sneaking out slowly.

Whether in trading or in plumbing, when shit hits the fan it does no good to panic. Deal with the situation quickly and efficiently, even though it stinks. 💩

The best way to really avoid panic selling first is to trade reliable coins that can still give you a little bit peace of mind even when the trades are going against you, provided you are not into all these margin trading of a thing. The good thing about trading reliable coin is because whatever dip you get when the market goes down, there will always be a rise that will get your investment back to normal level if patience is applied to it.

If you trade shitcoin, there is no way people will not panic sell, yes I understand we have to take things very calm and not jump into conclusion without being sure of the decision we make, but there are some coins we mistakenly trade out of greed that will be good for us to panic sell on time in order to minimize the big loss.

[XCANA]

The major challenge in trading or life in general is risk(knowing how to control risk or how to manage risk), without risk there will be no reward, so, if a trader need fortune, he must undergo risk. Whenever i get into trade, the first thing i think is, how to manage my risk to get out with something tangible.

[butka]

If you ever find yourself trading on a leveraged trading site, especially Bitmex, it's extremely important you employ market stops and not limit stop losses. Prices can slip right past a limit stop and not execute, whereas the market stop will at least execute and you'll close somewhere near where the market stop is located. You don't get a rebate on Bitmex with a market order, but it's better than a stoploss not executing.

This is a very good advice and is essential to implement for everyone trading on Bitmex. I myself always use "market stop losses". Luckily it is the default value. The difference between paying maker fees vs collecting taker fees is negligible in situations where your exit has to happen to prevent unnecessary losses and save your skin.

[Eildosa]

You're right. Situations are different and trading can also go in different ways. Sometimes there are bad days and sometimes good days. You have to get used to it and not panic.

[Kiefner]

You have to be very focused not to react to any external stimuli. It's good that you can keep a sober mind even in spite of what situations you have in life. Emotions really interfere with trading.

[dothebeats]

A very basic yet very useful advice. I myself have been into situations where panic never really do any good to me or to my trading ventures. I remember that one time in Mintpal (yep, 2015) where a certain coin was being pumped at ridiculously high rates. I have already profited a lot from my initial buy in but I have never thought of putting a stop-loss on my trades because I thought that it's still going higher. Fast forward just an hour after, I see the charts painting red everywhere and my profits have then disappeared. The panic in me immediately sold at an extreme loss, only to see that the price climbs back again to a range where I could have profited still.

From then on, I learned how to use stop-loss and accept a small profit than to have no profit at all.

[miropp]

Yes, your story makes a lot of sense. Emotions really interfere with trading. Therefore, if you learn to control yourself, you will become a successful trader. I fully agree with you.

[Shenzou]

Probably one of the biggest reason why people usually panic and start selling left and right when shit hits the fan, is because they haven't done enough research and just do trades based on other people's decisions and ideas, i get it sometimes you don't have the time to make research and look up what coins are goo and what are ones that are not going to do that well so you turn to those who are experts but you will never get anywhere if you just stay a follower, you have to believe in the trade that you are about to make and the coin that you are about to invest in in order to know what to do, and not do things because someone else said to do it. 

[creeps]

Yes, your story makes a lot of sense. Emotions really interfere with trading. Therefore, if you learn to control yourself, you will become a successful trader. I fully agree with you.

Thinking too much about trading makes trader panic, especially if they still affected by their emotion. We have to understand that trading doesn’t always about going up because it can also on a dumped position and yet trading will become more active on the ground. This only make sense if we do it, or else we failed in trading. Emotion is something hard to remove from us, but we have to try and be a good trader.