Translation (keeping HTML format, no code blocks, single line): The reason I created an EA after burning through my margin with emotional trading
“When I lose, I get angry.” “In trying to recover losses, I fall deeper.” — That was me when I traded discretionary. In this article, I share my experience of being ruled by emotions, repeatedly hitting stop-outs, and how I moved from that to developing an EA.
When I started discretionary trading, I believed in my own “judgment.” I read charts, analyzed news, and timed my entries. I thought that was “trading.”
In reality, the more unrealized loss grows, the harder it is to look away from the screen. Fear of realizing losses makes me hold on to positions. Then one day, an impulsive thought crossed my mind: “If I enter once more, I can recover.”
This is the entrance to emotional trading.
I repeated this cycle many times. With each loss I thought, “Next time for sure,” and every time I hoped for a reversal, losses grew bigger. It wasn’t a matter of my personality or a flawed method. It wasn’t either; it wasn’t until I realized that “trading with emotions” was the fundamental problem that it took a long time to accept.
When I developed Shoukin-ryu and did live streaming to demonstrate it working before release, stop-outs still occurred.
The version at that time had loose entry conditions with RSI threshold set at 14.3. Looser conditions meant more entries. Positions piled up, unrealized losses surged, and eventually margin nearly disappeared.
This is about the EA, but the essence is the same as emotional trading. “Looser conditions = desire to enter more” was reflected in the design.
Entries overlap → too many positions
Too many positions → unrealized losses explode → stop-out
After experiencing that stop-out, I fundamentally re-examined the EA’s design. Designing to chase profits is not as effective as designing to avoid losses in the long run. That is the core philosophy of Shoukin-ryu (v16) today.
The reason I started building an EA was because I could no longer trust my own emotions.
discretionary trading has “freedom to judge.” That freedom is both its charm and its trap. Freedom means there is room for emotions to interfere. When deciding whether to hold a losing position or cut it, humans inject emotion.
EA has no such freedom. It decides entry, exit, settlement all by code. The code does not fear, nor does it become stubborn. It does not chase to recover losses.
Impulsive entries after losses
Breaks of own rules
Fatigue and anxiety distort judgment
Inconsistency
Moves calmly even after losses
Design that cannot break rules
No fatigue or anxiety
Keeps consistent rules
I didn’t create EA just to make money. I was tired of being dragged around by my emotions. Since I started running EAs, my view of the market changed. It’s less about win or loss and more about whether the system is operating as designed.
Today, what I do every day is simple.
2. Record number of positions, unrealized losses, and equity maintenance
3. Compile a daily report
4. Leave it to the EA
I hardly think about “how to make profits.” Instead, I just confirm whether the EA is operating as designed and whether risk management is sound.
Even if unrealized losses grow to 300k or 500k, I don’t panic as before. Not because I trust the EA’s results, but because I built a structure that forbids adding to positions or exiting on emotion.
For those suffering from emotional trading, I don’t tell you to “train your mind.” I believe the only solution is to build a system that emotions cannot infiltrate.
・A temperament that gets angry when losing is worst suited for discretionary trading
・EA creates a framework that eliminates emotional intrusion
・Experiencing stop-outs helped establish stringent design standards
・If you can build a system that excludes emotions, your approach to the market changes
This article is for information purposes only and is not investment solicitation. The performance results published are past performances and do not guarantee future profits. FX/CFD trading involves risks. Please make your own investment decisions.