𝐓𝐡𝐞 𝐌𝐚𝐢𝐧 𝐄𝐦𝐨𝐭𝐢𝐨𝐧𝐬 𝐚𝐫𝐞:
𝟏. 𝐄𝐱𝐜𝐢𝐭𝐞𝐦𝐞𝐧𝐭
𝟐. 𝐆𝐫𝐞𝐞𝐝
𝟑. 𝐅𝐞𝐚𝐫
𝟒. 𝐀𝐧𝐠𝐞𝐫
𝟓. 𝐅𝐫𝐮𝐬𝐭𝐫𝐚𝐭𝐢𝐨𝐧
𝐋𝐞𝐭’𝐬 𝐭𝐚𝐥𝐤 𝐚𝐛𝐨𝐮𝐭 𝐭𝐡𝐞𝐬𝐞 𝐞𝐦𝐨𝐭𝐢𝐨𝐧𝐬 𝐚𝐧𝐝 𝐡𝐨𝐰 𝐭𝐨 𝐝𝐞𝐚𝐥 𝐰𝐢𝐭𝐡 𝐭𝐡𝐞𝐦?
1. 𝐄𝐱𝐜𝐢𝐭𝐞𝐦𝐞𝐧𝐭
When traders are going in your favor, it’s natural for you to be excited.
We all love to see “green” in the account, but here’s the problem with that:
when traders are going in your favor, you may be too excited and take on more risk. You get overconfident. But don’t forget, “things always turn out for the best,”
but that’s when trouble starts.
So please be careful when you experience excitement because it quickly leads to overconfidence, and the markets like to show overconfident traders who is the boss.
2. 𝐆𝐫𝐞𝐞𝐝
Greed can cloud your judgment, making you take unnecessary risks in pursuit of higher profits. It's crucial to set realistic goals and stick to your trading plan. Avoid chasing trades solely for the sake of maximizing gains.
Remember:
- Be content with consistent, manageable profits.
- Greed can lead to impulsive decisions, so stay disciplined.
- Focus on the long-term success of your trading strategy rather than short-term gains.
3. 𝐅𝐞𝐚𝐫
Fear is a natural human emotion that we all have.
In trading, it’s easy to let fear take over because you can see your profits diminishing in front of your eyes.
The problem with fear is, your mind goes crazy because you’re already thinking about how bad your trading account will be when you realize all these losses.
Here is what you should do when fear takes over:
-Step away from the computer.
-Shut it down!
-Go outside.
-Do something else.
-Take some deep breaths and relax.
Do not panic, this will cause you more harm than anything else!
#4: 𝐀𝐧𝐠𝐞𝐫
It’s easy to get angry at the markets because it’s so unpredictable!
You may have experiences like:
Huh, I sold it, see what now, market has recovered. I could have held it.
If you don’t know how to control it, it will lead to revenge trading, which is far worse.
𝟓. 𝐅𝐫𝐮𝐬𝐭𝐫𝐚𝐭𝐢𝐨𝐧
Frustration arises when things don't go as planned, and it can impair your decision-making. Instead of dwelling on frustration, take constructive steps:
- Analyze what went wrong.
- Learn from mistakes to refine your strategy.
- Accept that losses are part of trading and an opportunity for growth.
- Maintain a positive mindset and adapt to changing market conditions.
Keep in mind:
• Markets don’t know you exist
• Markets don’t care who you are
• Markets don’t know if you are in a winning or losing trade.
• Markets don’t care if you get angry.
By addressing these emotions with practical steps, you enhance your ability to navigate the complexities of trading successfully.
