A traders mindset is for me is the most important factor in becoming a consistently profitable trader. Early trading unearthed emotions i never thought existed and for over a year it resulted in me making wild and unjust trading decisions, enduring absurd bouts of internal fury and inconceivable lows. I had no one else to blame but myself. My unrivalled and world class trading mentors @j_graystone and @akilstokesrtm took me on a journey of self discovery, taught me about patience, discipline and relentless persistence. Forever grateful. Mucho Love 💚💚.
Without understanding the subject of trading psychology – and developing the emotions needed to play in the financial markets, trust me – you will get nowhere fast.
It will take time, and some of you won’t even make it. The reality is that 90% of retail traders fail in the long term. Partly due to trading psychology.
Fear in the markets causes traders to close out positions early regardless of their profit targets or to refrain from taking unjust losses. Panic in the markets can lead to sell offs – usually caused by some fundamental news release.
Greed on the other hand causes traders to stay in profitable trades for longer – with the aim of the market continuing beyond their take profit. Or, traders will sometimes risk more than their 1% in a trade in the hope of gaining more profits.
FOMO or Fear Of Missing Out can cause traders to jump in on positions that have already left the station. The lack of discipline will cloud your judgement massively, and 9 times out of 10 will result in some sort of loss.
This is the tip of the ice-berg with trading psychology and there are plenty of books, seminars and videos widely available to counter this problem.
Good luck traders.