One of the most common psychological pitfalls in trading is the breakeven trap â the mindset of holding a losing position simply because you want the price to âcome backâ so you can exit without a loss.
Many traders know this feeling: Youâre down 30%, and you tell yourself:
âJust let it return to my entry⊠then Iâll sell.â
This is one of the most dangerous mental mistakes in trading.
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đ¶ The âGetting Back to Shoreâ Psychology
When a trade moves against you, your mindset shifts:
1ïžâŁ From Profit-Seeking â To Loss Avoidance
Your goal is no longer to win â it becomes donât lose money.
This emotional shift destroys objectivity.
2ïžâŁ You Stop Following Your Analysis
You arenât holding the position because the chart supports it.
Youâre holding because youâre hoping it will return to breakeven.
3ïžâŁ Greed Steps In at Breakeven
When price finally approaches your entry:
You planned to sell.
But now you think:
âIt recovered⊠maybe it can go into profit.â
You donât exit.
Price reverses again â harder this time.
You become trapped in a cycle of hope â hesitation â deeper losses.
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đ¶ How to Break the Cycle
âïž 1. Cut the loss once the trade is invalidated
If your entry was wrong, close the position â whether itâs -10%, -20%, or -30%.
âïž 2. Donât negotiate with the market
The market does not care about:
your entry price
your emotions
your promise to sell at breakeven
Waiting for breakeven is not a strategy â itâs emotional bargaining.
âïž 3. Cutting loss = Liberation
A controlled small loss:
frees your capital
protects your mindset
gives you the ability to re-enter smarter
Small losses are not failures â
they are the cost of doing business.
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đ¶ Ask Yourself Before Holding:
âAm I keeping this trade because it still has potentialâŠ
or because Iâm praying it goes back to breakeven?â
Most traders donât like the answer â but itâs the truth that saves portfolios.
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đ Disclaimer
This content is for information only and not investment advice. Please evaluate your risk carefully before making trading decisions.



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