There is a tendency for traders to feel badly about under performing the market averages on a daily or weekly basis, but success as a trader does not come from such short term measurements or comparisons. We all have our cycles of under or out performance, but over time, the true measurement of success in trading is being consistently profitable regardless of how the overall market is performing. At the end of each trading day you shouldn’t focus solely on your P/L, instead you should focus on your thought process that day and how well you executed your plan. If you consistently execute your trades according to plan and still lose money then you may need to reevaluate your approach. While there is definitely a cyclical rhythm to the market, no strategy will always work. You need to constantly and objectively review what is working so you can make necessary adjustments to your plan.
You should always ask yourself whether your results are attributable to your ability to see the markets clearly and execute your plan with discipline, or if the market is making it easy to book profitable trades. There are times when the market makes a trader’s job much easier and huge profits can be made in short periods of time, unfortunately those times do not last. The trick is to hold onto those profits when the market becomes more difficult. Many traders experience large losses after a string of profitable trades because they succumb to the feeling “that the losses aren’t real, they are just giving back profits”. This dangerous thinking is borne from complacency as a result of a feeling of infallibility which leaves the trader vulnerable to large losses. You always have to take all losses seriously and minimize them at the first chance without hesitation, doing otherwise is how amateurs trade. You know what an amateur trader is? Amateurs are traders who make big money in a bull market, give it all back when the trend ends and then blames their losses on the market. Professionals listen objectively to the message of the markets and adapt quickly to changing market conditions.