We cannot control the market but we can control our trades and many aspects of our trading mindset.
When you go through a trading loss do you ever find yourself blaming something outside yourself? Today Nifty had a decent fall and if you made loss today You can Blame Bank of Japan, “the system” – the system is rigged against me etc..
When you blame an external situation, you are giving up control, and instead letting yourself be controlled by outside events. This converts you from a proactive trader into a reactive trader. When your emotions rule over you, You become SLAVE of market end results is you lose badly.
Justifications and excuses are the hallmark of traders who consistently lose. Excuses seek to diminish the trader’s responsibility for a losing trade, creating what psychologists call an “External Locus of Control.” This means that the trader believes he is acted upon by events beyond his control. In comparison, a trader with a strong Internal Locus of Control believes he is responsible for every reaction that happens to each action he takes.
When the trader feels external circumstances control his results, he will not do any homework, Will Keep watching financial news, How world markets are doing etc and the trader will not apply as much effort to prepare or trade. This makes it nearly impossible for a trader to build self-confidence as you are trading (actually gambling) on external events.
Great traders take total responsibility for each action they take. They do not carelessly take actions to buy or sell. Such impulsive moves can destroy the trader’s confidence. The successful trader knows that every action taken will produce a reaction, and actions taken with the probabilities on the trader’s side will increase the odds of favorable reactions over time. You must believe that you control your own trading results.
If you are not getting the results you expect of yourself, look inside yourself. Stat analyzing your actions and behaviors:
- are you trading on a plan.
- Do you have profitable trading strategy
- Are you cutting profits too soon
- Are you not able to pull the trigger
- Are you suffering from recency effect
Work on these basic aspects of trading or Internal Locus of Control , your trading will improve tremendous else you will remain part of losers who will keep feeding the professional traders.