Weakest Link of Trading

What is weakest part in trading?

  • Is it not having proper trading system?
  • Is it not having proper trading plan?
  • Is it not having proper trading Software?
  • Is it the trader themselves?

I have heard traders who make looses whine about market is manipulated, Its a fake rally, market will reverse from tommrow and i will exit at breakeven, my luck is not good and n numbers of such blame game excuses. Most of traders fails to understand its “The Trader Himself ” which is the weakest part in trading chain.


The weakest part of any trading method is the trader himself. There are n numbers of roboust trading systems both mechanical and dynamic that have and will make money on consistent basis in the long term. The problem is the trader having the discipline and mental toughness to trade one of them consistently.

Let me share an incident to which happened today, A reader of mine took trade in SBI bank  today which i have discussed in morning. He was able to get short SBI near 2483 and got out neat 2472 so he made some 10 points. After RBI reduced the repo and CRR by 25 BPS SBI rocketed and he got swayed away by positive commentary of Blue channels and did not do partial profit booking nor put any trailing SL and is now stuck with SBI taken at 2504.

What we can conclude from above incident System was proper it gave profits but the weak link ie. trader himself was unable to control his emotions and ultimately led to looses.

The vast majority of time it is not a system failure but traders that fail in this game through listed common errors. If you can understand these error and overcome them you could make a lot of money in the right market conditions.


  • Discipline to follow system religiously:The trader must have the discipline to take the system’s entries and exits and not taking trades based on intuition.


  • Loss are part of trading and do not be afraid of putting stop loss :The trader must have the discipline to take the stop loss on a losing trade when it is hit and not keep holding and start hoping, 70% traders hold on to their position thinking it will bounce back and eventually they get wiped out of the trade.


  • No money management and No  risk  management through proper position sizing, trading too big will blow up even the best systems.


  • It is the trader that must have the perseverance to stick to the method even during losing periods, and also stick with trading until success is reached.


  • If a trader can not manage their mind then the stress will break them, I have seen this happen many times. If you can’t handle losing you can’t trade.


  • The trader must find a robust method, must understand why it has an edge, and must believe in their methodology.


The good news is that if none of these error fit you when you lose money in a trade then the market was just not conducive to your methodology, and it is not your fault so don’t dwell on it.

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