For every minute you remain angry, you give up sixty seconds of a peace of mind.
– Ralph Waldo Emerson
So the markets are getting active and positive again, or so it appears. There are opportunities afoot, surely. It’s time to unleash that need to win and make it big. After all, as the activity in the market increases so does the opportunity to profit take.
But beware, as no matter what the market conditions are, the fact is that there are always obstacles and it’s just a case of how you deal with them that influences your profit taking capacity. Unfavourable reports, interest rate changes, natural disasters all impact in such a way that even with a detailed plan the markets go against you. The inclination then is to get frustrated and angry which is when you run the risk of acting irrationally and making mistakes that make a small setback become a major issue.
Anger will block all capacity to think clearly and rationally. Without clear thought and focus the inclination is to focus more on the subject of your anger rather than use that energy to look at ways to turn events in your favour. The risk of anger and irritation is greatest with traders as they see everything conspiring against them and that their lack of profits is because the markets and other traders didn’t do as they were supposed to which is somehow a direct attack on them. This is obviously irrational. This is not the emotional state in which to make sound judgements.
So it is time to step back and acknowledge the anger and identify the causes of it. This is hard to do when you are in the middle of it but the very act of stepping back will dissipate some of the emotions. Then the review will remind you that as a trader you shouldn’t be looking to beat the markets but to make the most out of it with the acknowledgement that it always remains in control. Therefore to be angry is not productive or going to reverse the situation, after all the market is a collective that should be seen as an entity, not a group of individuals.
It is essential as a trader to start out knowing that setbacks are inevitable. It is impossible to have a trading career where you always win as markets shift, strategies become obsolete, and events occur that can dramatically shift a stock.
Just look at the past 12 months to see some of the key events that could never have been predicted such as the oil price plunge and Chinese market crash. Expect these things to occur frequently, regularly and don’t have such high expectations that you can’t absorb any associated losses or emotionally cope with the impact. These are effectively predictable events as is the inevitability of making losses.
Start out as a trader and with each trade in the knowledge that there are no guarantees. This acceptance should reduce your susceptibility to anger if a trade goes against you. In this way you put yourself closer to the mental attitude of a winning trader and more able to turn the negatives into an opportunity.
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