We have just looked at the first big mistake traders make, placing stops too tightly, and now we must look at the second, taking profits too early. For the record the other two are trading far too often and not trading in sufficient size.
All of these are driven by our enemies: fear and greed. In fact these tend to drive all the major mistakes. The exception being not putting in sufficient work, which stems from lack of commitment and laziness.
It is fear of loss which makes amateur traders place stops too tightly. They just can’t bear to see those losses mounting up. They would rather cut and run than see the trade slip further into the red.
Similarly it is pure greed that makes people grab profits early. They need the hit ...