Importance of cutting losses.

It's essential to your longevity in trading that losses are minimized and your winners are exploited as much as they can be. This will be a short write-up focusing on just that.
My problem last month was losing my shirt with huge losers but thankfully I'm consistent enough to make it back over a period of days but afterwards my hot green streak would be met with, what else but another huge red day. I'm doing well with consistency but not so much in dealing with my losses.
Therefore, this month I am working on fixing that aspect of my trading.

I want to go over my GPRO long trade for today and how it illustrates the principle of cutting losses to a T.

I entered at the area in which the area is placed with an average of  $97.34 and a plan to add if it dipped but held a higher low. It's necessary for it to hold a higher low and prove it's upward trend for me to add into a "losing" long position, otherwise I am merely adding to a loser.

Upon cracking that horizontal white line, it confirmed to me I had the wrong bias and it was in fact not in an upward trend. 

The blue horizontal line was my planned stop before heading into the trade. Once I was in the trade, I was being stubborn in that I kept thinking about moving my stop lower.

Its IMPORTANT to not change your PLANNED stop loss once you are in the trade. The stop was placed there during a state of calm and there is no reason for it to be moved besides the sheer fact that the trader is too stubborn to take the small loss.

I remembered this as well as the other times I was stubborn and cut my GPRO long trade at low 96.90's, my PLANNED stop loss, for an insignificant loss.

This is what happened afterwards:

GPRO eventually reached a LOD of $91.22. I wouldn't be able to trade another day had I been too stubborn to admit I was wrong. 

It's ok to be wrong but ALLOW yourself to be wrong.

Summary:

Have a plan prior to entering the trade

Do not change that plan once you are in the trade