Trader's Queries - Manual for trading - Part 1
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Query : How to over come losses and become a profitable trader?
Answer can be written as a book. So I am posting it in parts.
Trading is a journey like life. You have to learn from each and everything happening to you and grow. Like life trading do not have any manual to give instructions about how to handle it. That is why people got struck in trading.
Let us say “person A” was making consistent losses, or making capital zero more than once and get enrolled automatically in to the state of “feeling struck”. At some point every trader “feel struck”. Now the question is what to do next.
When we feel struck we “over dramatize” things. We do not see the big picture. We get confused and feel there is no way of coming out of it.
Step 1 : Accept the situation. Do not resist it. Do not create stories dwelling on it.
Step 2 : Stop criticizing yourself or external circumstances like market movement, big players etc.
Step 3 : Separate the facts, your interpretations about it and the corresponding emotions.
Example : Person A lost money in trading today.
Fact : Lost money
Interpretation : I did not pre plan my trade as I did not have time.
I did not have discipline.
I did not understand market movement.
I did not have enough technical knowledge.
It was not my fault.
I did not manage emotions during trading.
These interpretations result in creating emotion like
Guilt
Fear
Depression
Anger
Frustration
Sadness
Step 4 : Repeatedly worrying about the same situation would not help you. Consult with a person who is trading better than you, so that they can uplift you.
(To be continued...)
Answer can be written as a book. So I am posting it in parts.
Trading is a journey like life. You have to learn from each and everything happening to you and grow. Like life trading do not have any manual to give instructions about how to handle it. That is why people got struck in trading.
Let us say “person A” was making consistent losses, or making capital zero more than once and get enrolled automatically in to the state of “feeling struck”. At some point every trader “feel struck”. Now the question is what to do next.
When we feel struck we “over dramatize” things. We do not see the big picture. We get confused and feel there is no way of coming out of it.
Step 1 : Accept the situation. Do not resist it. Do not create stories dwelling on it.
Step 2 : Stop criticizing yourself or external circumstances like market movement, big players etc.
Step 3 : Separate the facts, your interpretations about it and the corresponding emotions.
Example : Person A lost money in trading today.
Fact : Lost money
Interpretation : I did not pre plan my trade as I did not have time.
I did not have discipline.
I did not understand market movement.
I did not have enough technical knowledge.
It was not my fault.
I did not manage emotions during trading.
These interpretations result in creating emotion like
Guilt
Fear
Depression
Anger
Frustration
Sadness
Step 4 : Repeatedly worrying about the same situation would not help you. Consult with a person who is trading better than you, so that they can uplift you.
(To be continued...)
Nota
Dedicated to my beloved followers :)
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