Yesterday I gave my analysis on Indian Cement , Buy call got stopped out and Sell achieved the target but few traders called me yesterday, “Bramesh Sir, I am still Holding Long in Indian Cement as per your analysis, I was bit taken back because we got stopped out in morning trade only and trade was moved to shorts which achieved the target. I asked why you do not keep SL, He said Sir I do not believe IN Stop loss”. I did explain him the importance of SL but I know they are falling in deaf years and till the person is not motivated and committed towards learning he/she will always end up as loser.
Emotions have no place in trading, especially for day traders as their holding period is for few hours only. Most of traders are searching for Magic Indicator or Holy Grail which will lead the desired results and will never cause any loss to them. But in Reality No matter what technical indicator or stock trading system that trader used, results is always the losses. So where is the real problem It lies in Psyche of trader.
How to fight with Trading Emotions
If you want to conquer your trading emotions, Suppose you made a vow you will always put stoploss in all trades you will take from tomorrow onwards. As soon as you place a Stop loss after you took a trade you will face strong resistance internally “What if the Stop loss gets triggered and Stock Bounces back again”. Now to fight this emotion requires a leap of faith, and trust on your abilities and trading system you are following. I have seen many trader’s who psyche themselves up and temporarily follow their stock trading vision. The problem arises when trader’s experience the emotions of losing; many tend to lower their expectations and go back into their shell, going back to what they are used to. They start reverting back to old habits and going back to square one again.
Any time you make changes, you will face internal resistance from within, fear, fatigue, insecurity, but do remember Change does not happen overnight and you have to stick with your convictions in the face of self-doubt; be patient and allow yourself time to achieve the goals that you set out to reach. To manage your trading emotions, you have to accept the negative feelings that you internally attempt to suppress.
It requires lots of mentoring and self realization but a person who is determined can do this and chart the path of successful trader who has control over his emotions.
Don’t allow yourself to become a victim of these negative thoughts. They will only serve to distract you from concentrating on what needs to be done. Again, we want to attack the root of the problem which is how you interpret these feelings. You will not necessarily be able to rid yourself of them; however, you can stop focusing on them. Focus on the future and on what you want out of it. It is key that you change your thought process when it comes to negativity.
Remember, the more you can disassociate yourself from your emotions, the better at stock trading you will become.