đą How to Use Trading Psychology to Become a Better Trader Continued
đąLearn from mistakes
Everyone makes mistakes when trading. Instead of getting angry at yourself or worse, trying to recoup your losses with even more capital, go back and analyze what went wrong. Implement new strategies based on what you learn from previous mistakes and youâll be more prepared the next time.Â
đąSet rules Â
Create a detailed trading plan and stick to it. This plan will outline how you approach different situations and will help keep your reactions under control during times of stress. Some examples include using stop-losses and take-profits, limiting how much money you can gain or lose in one day, and a risk management strategy with which youâre comfortable.Â
With a clear plan in mind, youâll know exactly what steps need to be taken without allowing an emotional response to derail your decisions, ensuring you donât stray from the initial plan you set out for yourself before entering a position.Â
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