Your Trading Strategy has generated the the BUY or SELL signal. All you need to do is log into your online trading account and place the order.
But right at that moment, all the doubt and second-guessing comes to a head, and the buy or sell signal is never executed.
Sound familiar? It’s probably the most common problem faced by retail traders.
Decisions, Decisions, Decisions
Do any of these sentences sound familiar? Have you said these same words?
1. The Trading signal says one thing, but this other indicator I have says another.
2. There is absolutely no reason the market should move in that direction. Everyone knows it look at the current market sentiment!
3. What if the signal is wrong? What are the consequences?
Suddenly you become very good at second guessing. You can easily find a few dozen reasons not to execute the signal after all. You even feel good about “not” taking the trade… at least for awhile.
“Uncertainty is a powerful emotion that can weaken the resolve of even the best of market traders.”
Perfection Does Not Exist
1. At no point in time will all indicators be in agreement. That’s just the nature of technical analysis. You are following a strategy that makes money over time. It is not always right, but it is profitable and it outperforms the market. That is what you need to focus on. Perfection does not exist in market timing or trading.
2. The obvious or logical buy or sell signal is not always the profitable trade. Sometimes the market is easy to read, such as during a long trending bull market, but sometimes its true nature is completely hidden.
3. All actions in the market happen for a reason. We may not always understand the cause, but we really do not need to! All we need to do is execute the trades and the profits will follow.
Believe in yourself and your ability to trade successfully.
Believing in your trading edge and in each occurrence of your edge requires that you first believe in yourself and your ability to trade successfully. Clearly, if you don’t believe you CAN be a profitable trader you will never ending being one. However, many traders sabotage their own efforts at making money in the markets simply because they don’t think like a pro trader; they don’t believe they can make consistent money in the markets.
Pulling the trigger may be the toughest thing to do, but it’s also crucial to successful market trading . It’s better to take action, than it is to sit back and let the market pass you by. The trade you do not take, will likely be the trade that makes most of the profits for the entire year.