The five patterns that drain trading accounts.

A revenge entry happens when you enter a trade primarily to recover money lost on a previous trade — not because the current setup meets your criteria. The trigger is emotional: the sting of a loss, not the signal on the chart.

You close a red trade. The P&L number sits there. Before the position is fully closed, you're already scanning for the next entry — something, anything, to make it back. The setup is weak or absent. You know this. You click anyway. The new trade is not a trade; it's an argument with the market.

Revenge entries compound losses. The first loss was part of trading. The revenge trade was chosen by emotion, not edge — which means it has a lower-than-average probability of winning and is often entered at worse-than-average size. Two losses become three. The session spiral begins here.

Loss chasing is the act of adding size to a losing position, or re-entering a position in the same direction shortly after being stopped out — driven by the belief that the original thesis must be right and the market must reverse.

You're short a stock. It runs against you. Instead of cutting, you add — because your read feels correct, because you're now 'getting a better price,' because this has to turn around. Or you're stopped out cleanly, and within minutes you re-enter the same side without a new catalyst.

The market doesn't know or care what your entry price was. Adding to a loser turns a defined-risk trade into an undefined-risk trade. Each add extends the potential drawdown. The position that was supposed to be one unit of risk becomes three. When it finally moves against you decisively, the damage is not three times your normal loss — it's often far worse because averaging down delays the stop.

An oversized position is a trade where the share count, dollar risk, or percentage of capital significantly exceeds what your own trading rules allow for a single position. The threshold is yours — the flag fires when you cross it.

Your rule is 500 shares max on small-cap setups. Confidence is high — the chart looks perfect, the news catalyst is strong. You take 1,500. Or you have a $200 daily risk limit and you put $400 on a single trade because you're convinced it's a high-probability setup. Conviction feels like information. It isn't.

Oversized positions make rational decision-making impossible. When the loss on a position would meaningfully damage your account, you can no longer manage it according to your plan — you manage it according to your fear. Stops get moved. Exits get delayed. The position controls you, rather than the other way around. On its own, oversized is roughly neutral in outcome — but in combination with a runaway trade, it becomes the account-killer.

A runaway trade is a position held significantly past the point where your plan said to exit — whether that exit was a time-based rule, a price target, a trailing stop, or a session close rule. The trade has 'run away' from the original parameters.

Your plan is to be flat by 10:30 AM. It's 12:15 PM and you're still in the position. Or your target was $0.40 and the stock reversed through it — but you held, certain it would resume. Or you planned to cut at the open's low and it's now well below that with you still long, telling yourself it will recover.

Here's the nuance most tools miss: a runaway trade on its own is often your edge. Long holds at normal size can win at a high rate — that's a real pattern, not a flaw. The problem is not the hold. The problem is when holding combines with oversized size. That combination — the Toxic Combo — is where the real damage lives. A runaway flag alone warrants attention; a runaway flag paired with an oversized flag warrants investigation.

A daily-limit breach occurs when you continue trading after reaching your self-imposed maximum daily loss. Every trade taken after that point is a breach — regardless of outcome.

Your rule is to stop trading at -$300 for the day. You hit -$310. The market is moving. You see a setup that feels like a clear reversal. You take it. You might even win the trade. But the rule was broken the moment you entered — the outcome is irrelevant to the breach.

The daily loss limit exists precisely for the mental state you're in when you hit it. After a full limit loss, your decision-making is compromised — not because you are a bad trader, but because loss aversion, frustration, and sunk-cost thinking are operating at full strength. The limit is not a suggestion. Analysis of strict daily limit discipline shows it can turn a losing year into a profitable one — not by improving your good trades, but by eliminating the catastrophic sessions that occur when you trade past the point where your edge is intact.