Today we have a special treat for you. on what may be one of the most important, but little understood, factors that help define how successful a trader may become: Emotions and Trading. Enjoy it!
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Tackling the Emotional Demons That Wreak Havoc On Your Trading Account
It is easier said than done to keep your losses small and let your winners run. We've all experienced the powerful emotions involved in trading and the challenge is to keep those feelings at bay when we're in the middle of a trade and to do what we know is the right thing. All too often, though, they get the best of us and we wind up making decisions that we regret later.
How frustrating it is especially when we make the same mistakes over and over again without knowing how to change what we do. We want a different result, but we get caught.
You too may have experienced the anxiety of pulling the trigger when you know you should. That fear of being wrong or the market turning against you as soon as you've entered grabs hold of you and paralyzes you. It seems next to impossible to just "do it" and take action. Maybe you've had a trade that really went south on you and you just have a hard time keeping it from coming to mind when you're placing trades.
Or how about the urge to avoid placing your stop-loss order, because it's happened too many times that you get in, get stopped out almost immediately, and then the market takes off just like you expected it to. Ooh, that is so aggravating! And of course we can't leave out revenge. When we 'get hurt' by the markets and their uncertainty, it is a natural impulse to want to get even.
Emotions don't come from the logical part of our brain. They are a mechanism that functions at a lower level, and that's why they can be so hard to deal with. Now, some say to "trade without emotion", but that is neither possible nor would you want to shut off the emotional centers in your brain when trading. Emotions are part of who we are and a vital part of our decision-making process.
Einstein recognized that "We cannot solve problems from the same level of thinking from which they were created." This is especially true of emotional challenges.It usually takes the help of someone outside of us to help guide us to the root cause of the issue. Someone who can understand our situation and what we're dealing with that can lead us to the specific factors that are coming into play, and then give us specific actions to take to address the matter.
That's where having a knowledgeable trader to bring your issue to can really help. One who understands the psychology and challenges of trading, who knows the right questions to ask to help get to the root cause, and who also can give specific actions to take to make lasting change for the better.
We hope this article has piqued your interest in this topic. More post On These Coming Later.
Delords
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