Trading Psychology is Important to be in the game for the long run
- Never trade so big that you end up watching every price tick even though you are not a day trader.
- Don’t trade so big you dramatically increase your heart rate or sweat.
- Each trade should only be one of your next one hundred trades and not impact your emotions or ego.
- Don’t spend time obsessing over market hindsight. All you can focus on is following your trading plan in real time.
- Forget about your last trade and focus on your next trade.
- Losses should be lessons that you paid to learn. Look at drawdowns in the capital as tuition and not failure.
- If you followed your trading plan, your loss is just part of the process to get to profitability. Think long-term.
- Position sizes can’t be so large that they compromise your emotions and distract you from your trading plan.
- Don’t revenge trade to attempt to recover your losses. Stick to your trading plan regardless of your equity curve.
- Your signals have to be based on price action and not greed, fear, or your ego.
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