If you are thinking to become a Full Time Trader you need to understand the physical and psychological stresses that the market brings to you!
If you want to be a successful trader you need to CONTROL YOUR EMOTIONS, this is the key. You have to figure out a way to manage your reactions to the market OR trading is NOT for you. If you panic, you will no longer be trading to win, but trading not to lose. Not to lose is of course important but you need to understand that there is always a RISK to take when opening a trade and you must accept losses, learn from it and keep going. If your goal is not to lose, you won't take appropriate RISK. Knowing the emotions that affect trading and having some ways to manage them can improve your overall performance.
Everyone experiences different emotions while trading and I would like to list the most common ones:
😰 ANXIETY: The anticipation of things going wrong. You might hesitate and miss a market move or you might hold too long on a losing position because you are worried about the effect that selling it will have on your portfolio. Focus on your trading plan, not on making a set amount of money.
🤑 GREED: The opposite of anxiety. When you get Greedy you might do stupid things. You don't think anymore, you only see money and you stop following your trading plan. You hold positions too long in the hope of making a massive return or you FOMO into a coin that is pumping, fear of missing the opportunity. Greed will make you rush into trades and make terrible decisions, you will then lose discipline first and then lose all your money.
😭 FEAR: It's probably the worst between the emotions. Fearful traders trade not to lose money. You are afraid to enter trades because you are worried about what will happen if you lose that trade. This is an emotion that might stop you to become a successful trader. You need to figure out a strategy for it. The best one I suggest you is to TRADE HOW MUCH YOU ARE WILLING TO LOSE. Think about what will happen if you lose a certain amount of money and trade accordingly.
😐 BOREDOM: Some days the market can be really boring. Nothing is moving and your "Making Money" Mentality might make you do something stupid. When you feel bored and there isn't really much to trade, TAKE A BREAK. Close your positions, relax and be PATIENT. Opportunities will come. Not every day is GOLD especially in Crypto.
🤒 DEPRESSION: This is a very severe one. Many story tales I heard about Traders falling into deep Depression. The Ups and Downs of the Market can really hit us. Especially if you do this FULL TIME, it can be though to be in a long BEAR market. In Crypto this is more than real. We can see coins go up 3000% in 2 months and then 90% crashes few months later. If you do not use good strategies to manage your Capital, if you do not take profits out often and you do not manage all the above Emotions... Depression can HIT you hard. This is a 24h market so there's always an opportunity to make money and this could drive you NUTS! Remember: Successful traders have a life outside of the market. Manage your RISK, believe in your trading plan and set specific hours when you should trade. When time is over, close your Laptop, go out enjoy your family and friends and ENJOY LIFE.
Find your way to MANAGE all the above emotions and you will become a better trader!
For further any queries
Ask @luckys
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