Did you know that having the right psychology in trading can lead you to success?
Aside from learning different tactics in trading such as Technical, Fundamental Analysis, and other trading analyses out there, learning how to trade with the right Psychology is one of the best ways to be a successful trader. This will help you to control your emotion and develop the discipline that every trader need.
To have the right Trading Psychology, you have to overcome these emotions that will sabotage your trading decision. Fear, Greed, Hope, and Regret.
Did you ever experience that you made an analysis where you did not place a trade but your analysis is correct? Or, you enter the market early because you are afraid to miss the trend? Or, you exit your trade early without hitting your target? This is only because you have Feared in your heart that makes you afraid of every move that you are about to do.
Fear is known to be the natural response of a human being to threat or danger. If you have it on your trades, you are basically protecting your capital from losses which is good but keep in mind that having too much Fear can lead to poor decision making in trading.
Overcome Fear, place your trade, use the proper risk management, and let your trade run. Believe in your trades!
Not having Fear is Greed. This the complete opposite of Fear where you do not care about losing and you only care about your desire to gain a massive amount of profit from your trades without thinking about the possibility of losing your capital. Greed is very dangerous on a trader which if not controlled may result in losing trades. Remember that the market can reverse anytime, so stop being greedy and take your profit!
Did you ever experience not placing a stop loss on your trade and the market goes against your bias? Hoping that the market to come back and pick you up? Well, you're hoping too much! Do not expect that the price will come back for you because it's not. It's always important to place a stop loss on your trades and move on when the price hits it. There's always another trade for you!
A feeling of Regret usually occurs when your analysis is correct but you are unable to place the trade or you missed out on the trade. This emotion in trading is the easiest to overcome. Always remember that the market is open 24 hours and 5 days a week. There is always another opportunity ahead to look for. Stop being disappointed in missing a single trade because there is always a next time!
To summarize, these four emotions in trading can be overcome with proper discipline. Be in the middle of the circle of emotion. Always plan your trade then execute your plan. Never modify your trades (moving stop loss when the price goes against you) just move on if you lose because there is always the next time in trading.
JUST REMEMBER, TRADE AT YOUR OWN RISK! 🔥🔥🔥