Successful trading requires mastering your emotions and avoiding instinctive reactions that often lead to poor decisions. Many traders are quick to lock in small profits out of fear of losing gains but hesitate to exit losing positions, hoping for a recovery. This mindset—driven by greed and a reluctance to accept losses—can trap you in a cycle of small wins and large, devastating losses. Instead of doubling down or holding onto a losing trade, adopt a disciplined approach: set predefined stop-loss levels, accept small losses as part of the journey, and focus on managing risk rather than chasing unrealistic gains. By staying objective and sticking to a strategy, you can protect your capital and position yourself for long-term success in the markets.
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