No one likes losing trades. Least of all, me.
But to become a successful trader is to understand that there is no perfect strategy that wins all the time.
If you’ve been following my articles, you’ll know that everything — every single trade I place — starts with spotting a strong trend.
The Backdoor Income strategy adds a powerful options scanner that seeks out huge market-moving orders.
And when we combine those two things, more often than not — over 75% of the time — we end up with great winning trades.
But when we placed this trade on April 11th, the market was just starting to turn…
So that powerful trend that helped us pick NVDA turned on us in the days after we entered it.
The week after that trade, I put out this article, where I explained why I shorted AVGO.
I talked about the changing trend of the market and how two big red flags caused me to short AVGO.
A day or two later, I got a customer email in my mailbag asking why I didn’t use the same strategy on NVDA the week before.
While it might seem inconsistent, I think it’s important to note that the trades happened almost a week apart.
And in that week, the turn of the market really became apparent.
As I mentioned before, the Backdoor Income strategy is based on pairing huge, market-moving options orders — “whale orders” I call them — with a strong trending stock.
So the huge, $4.3 million dollar options bets that were hitting the market, paired with NVDA’s strong trend told me that this was a solid trade to enter.
The best thing we can do when we have a losing trade is to look back, analyze it and decide if we broke any rules.
While I hate losing, we stick to the strategy, because over time that’s what has gotten us our phenomenal 75%+ win rate on this strategy.
Trade well,
Jack Carter
