This one is really easy to do, especially since most people think trading is all about the setup. Certainly, possessing very strong technical skills is a critical component of trading success. Waiting so long is not a professional approach to trading. Doing so prolongs the learning process and can leave the trader frozen like a deer in the headlights if they have been trading unaware of how their psychology can hurt them. But so price action trading too are understanding sound money management and developing solid mental skills for trading. I’ve actually coached many traders who don’t start to learn about trading psychology until their account is nearly wiped out or they have become so fearful of taking another loss that they just can’t pull the trigger!
What to do instead
Every good trader knows that psychology is an important part of the trading game; it’s in every serious book on trading. Focus on your own trading psychology. Start to learn the mental skills needed to trade well right away. Make time available each week to work on your personal psychology. There are many helpful trading psychology resources available to a trader, including links to my website and blog, which you will find below.
Thinking you have to Control and Suppress Strong Emotions to Trade well
This just isn’t true. It’s also not possible. Yes, you can influence your emotional state and sometimes override you emotions, but to consistently control fear, for example, just isn’t possible. We are human. We have innate emotional mechanisms that will absolutely trigger when we take on risk. We don’t have much control over them. Even traders with 20 years of experience still feel uncomfortable when putting on a trade. Why? Because so price action trading is an environment of uncertainty. We never have complete information. Every trade is about taking a risk.
Struggling with Your Emotions
This is the worst thing to do. When you struggle with your emotions, you take your focus off the market and put it onto your internal state. Attention goes to the scary feelings, muscle tension, pounding heart, and a mind that is telling you to get out of the trade or do some other action to reduce the discomfort. Attention is not where it should be. No one can manage a trade without focusing on it.
What to do instead
This builds on being more open to uncomfortable feelings and thoughts. Know exactly what is needed to manage the trade. Know where the profit target is, and what the trade will look like if it is working. If you are intrigued by what you have read here, you will love the free Mental Skills e-Course – you’ll get 7 key tips you can immediately use to improve your trading performance and your trading psychology.It is helpful to imagine this in your mind’s eye ahead of time. Also know what it will look like if it is not working or something arises that would cause an early exit. Keeping composure while trading is just one mental skill, there are other important trading psychology skills a trader needs to know. Then, keep your focus on these factors rather than your internal state. This is maintaining composure under pressure.