I trade on break outs. When you trade on breakouts you run the risk of going long at a top or short at a bottom. I also risk a very small percentage of my capital on any trade. This means a lot of stop outs. I am reading a book by another break out trader in the Cocoa market that follows very similar rules of trades and risk management as I do. Here is what his account looked like.
Imagine getting stopped out 17 times in a row for a loss of $16,750. Would you have the discipline to continue? This is what breakout trading is all about. Lots of small losses and very few large winners. I can attest to the fact that this happens. Losing streaks like this will come. A good trade is a trade where you follow your rules and employ proper risk management. A good trade is not necessarily a winning trade. The novice thinks in terms of right or wrong and winners or losers. Seven out of my ten trades are losers. I consider them all good trades though.