What if I told you that a losing trade could actually be your biggest confidence booster? Well, you’d probably think that I was crazy & immediately move on to the next article of interest. But hear me out…


Becoming a successful trader is a long journey & it’s certainly one that doesn’t happen overnight. In my experience of coaching traders & speaking with some of the best minds in the field, saying that it takes about 1 to 2 years to become consistently profitable would probably be on the low end. Some may be discouraged to hear that but before you blindly trust that internet guru telling you that it can happen over the weekend with his super-secret $99 course, think about any other skill-based career in the world and ask yourself if you can become one of the best in that field in just a few days…Yeah, I Thought So. The point being, mastery comes from consistent improvement, so the goal of an aspiring trader isn’t to master the markets right away, rather to slowly develop the skills needed that will eventually lead towards that mastery.


To start, we know that no strategy wins all of the time & that the markets will do what they want, whenever they want to. Our job as traders is to understand the probabilities of specific setups & pair that with solid risk management techniques. In order to have a winning trade, we must be correct in 3 areas, the entry, the stop & the target. The entry is where we initially get involved, the stop is a level where we would exit the trade for a loss & the target is where we would exit a trade if we are right.

So let’s say you enter a trade & price immediately pauses around your entry before it starts moving in your direction only to make it halfway to your target before reversing & stopping you out. This would be considered a losing trade.

Now while most new traders would simply look at the outcome of the trade & see it as a negative, a professional trader would review the entirety of the execution & see it as a mixed bag. Sure the trade lost, but you were right in one aspect of the move, the entry. How do we know this, because price fought, held & eventually reversed in your favor at that level. So when reviewing this trade, you should be able to take confidence from the fact that you were correct in making the right prediction when it came to the entry point & what you need to continue to work on perhaps is becoming more efficient with your target placement.


Trading is a game of confidence & if you don’t have it the market will tear you apart. Confidence comes from proper preparation, but more importantly, experience aka time in the markets. During that time in the markets, it’s important that you continue to feed that confidence as much as you can because trust me, you’ll need it to get over the numerous obstacles that will stand in your way.

So the next time you think about punishing yourself for a losing trade, take a second to focus on these 2 things.

  1. The things you did right.
  2. The things that you can improve on for the future.

For more on this subject check out this episode of The Trading Coach Podcast

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Akil Stokes

Akil Stokes

Trader — Trading Coach — Host of The Trading Coach Podcast — Author for Entrepreneur & FX Trader Magazine — Proud Husband & Father — Sports Nerd & Coffee Addict