This is probably one of, if not, the most common problem that traders encounter.
The urge to chase systems in the constant quest for the holy grail of trading is never ending for most new traders and it is this urge that is taken advantage of by all the crooks and sharks in the retail forex industry.
The main reason this cycle is carried out is due to the fact that a trader has unrealistic expectations about losses or returns…or maybe even both, so they take a few losses in a row and decide that it’s time to get a better system.
The reality of trading despite any preconceived ideas you may have is that all professional traders including me have losses on a regular basis.
You need to change your view of losses and view them the same way a professional sports player views getting tackled in a game, they may lose possession of the ball which is not a good thing but they never let it ruin their whole game!
They just keep playing the way they have always played and overall they usually come out on top, they never stop or start worrying about their game or whether they should get a new coach or change their style.
Trading losses should be looked at in the same way.
If you keep your risk really small each loss is just like a mid – game tackle, no big deal. In fact keeping your risk really small is probably the key to this one.
One other thing that I recommend doing is giving your plan or system at least 30 trades, over which time you can get a fair assessment of it in most market conditions. After the 30 trades you will most likely find yourself in profit, and you will have seen your set up work many times.
The combination of these things and knowing that this is a dangerous killer to your trading should make it easier to stop being a system chaser.