Trader Psychology Tip: Managing Positions with Dual Accounts for Trends and Reversals

A common aspect of trader psychology is illustrated here: after initiating a good position at its peak and reaching initial profit targets, traders face a dilemma. They can either extend their position towards the next level or close and trade in the opposite direction to ride the swings in both directions. The decision is often hindered by transaction costs and the hope that the trend will continue unbroken, causing a rapid price increase. To manage such frequent market scenarios, it's recommended to maintain two accounts: one for capturing large trend movements and another for counter-trend trades. This approach allows traders to close main positions without regrets when against-trend trades are successful. Basically, it’s a must-have strategy! :)