Tracking the gap between trades, and the cluster of fast ones that lost

[Fairman]

Tracking the gap between trades, and the cluster of fast ones that lost

I added a column to my journal for the number of minutes since my previous trade. It was easy to calculate from the timestamps, and when I sorted the data, there was a clear pattern.

Trades that came within a few minutes of the previous one had a clearly worse result than those with a longer gap. Many of them were after a loss, and some were after a win. In both cases, I was acting on momentum or emotion, not on a fresh setup.

When I looked at specific examples, a lot of them were cases where I hadn't properly reset. I was still in the mood of the last trade, whether frustrated or excited, and I took the next signal without thinking. The gap between trades acted as a measure of how much I paused.

I put a rule in place: a minimum gap of ten minutes between trades unless I'm managing the same trade. It's an arbitrary number, but it's been enough to force a pause. The number of rushed trades went down, and my average quality went up a bit.

[Fairman]

I added the same column after reading something similar and saw the same pattern. The fast trades after a loss were the worst, but the ones after a win were not much better, which surprised me. I think after a win I felt confident and lowered my standards. The ten minute rule seems arbitrary, but I agree that the number matters less than the pause itself. Mine is fifteen, and during that time I write a short note on the last trade.

[Fairman]

Something I would check is whether the gap matters differently depending on the setup. For me, one setup naturally produces two signals close together, like a failed first entry and then a valid second one, and those were fine. The bad fast trades were the ones that were a different setup or no real setup at all. So I made an exception for the planned second entry and kept the rule for everything else. Being precise about which fast trades are the problem kept the rule from blocking good entries.