“The Trader’s Mindset” is what a amateur trader need to work on to move in category of professional trader. Any World Class Athlete you would have seen give much importance to the MINDSET before any big game. So its only your MIND you need to TRAIN to be a good trades. Millions of strategies but a mindset to be a successful trader only few have and eventually those few traders succeed to make big. Many of my students during the trading course ask me this question and we talk about it a lot with traders I mentor.
When we trade the markets we approach the markets each and every day with a psychological mindset or set of beliefs and emotions. New traders often enter trading with beliefs about trading and the markets that simply do not apply to the realities of trading. This is why new traders get into trades and can’t get out or don’t know when to take profits or get out at the bottom and get in at the top of markets. In other words they make bad trades because they are trading from inaccurate beliefs and become subject to their emotions of fear and greed.
With proper education, experience and direction these traders can turn their trading around. Usually new traders realize after awhile of experiencing large losses or working very hard and still losing that they need to change. What they thought would work does not and they recognize that their emotions are working against them and not for them in trading.
Once they get to this point, traders either quit trading or seek help to overcome their trading handicaps. If you find yourself at this point, you need to seek help from someone who is a successful trader. The help you get or don’t get at this time will seal your fate as a trader. We teach you the importance of controlling yourself when trading. We call this developing “The Trader’s Mindset” to think as a trader should and not become subject to your negative emotions. In order to be successful in trading, you must not fall prey to the very emotions you are trying to exploit. In short term trading when we win, someone must lose. This is a hard cold fact of short term trading! And the successful traders usually are calm and very methodical in their trading and making money from other traders who react emotionally to market events and are therefore losing money.
“The Trader’s Mindset” knows how emotions effect trading and learns how to deal or master their responses to their emotions as well as other trader’s emotions. So, how to we develop “The Trader’s Mindset”?
The definition of mind set, according to the Wikipedia website, is a set of rules, methods, or systems that a person may have that is so entrenched in their psyche that it creates a powerful reason for them to continue adopting or accepting past behaviours and choices.
The challenge with having such biases is that it often becomes difficult to reduce its effects upon analysis and decision making processes. On the other hand, a mind-set can also be seen as part of a person’s philosophy of life.
Take for example, having a Profitable Trader mind set. While anybody can become a Profitable Trader; not everybody will. This is not because it is not achievable, or out of their reach, but because they have never understood the importance of having a Profitable Trader mind set.
They do not understand that a Profitable Trader thinks differently to most other people. If you study any wealthy person, you will soon notice that they have a different mind set, as well as different habits. They have a different take on both problems and opportunities. It follows that different thinking patterns feed through to different actions and strategies.
The average person may think that millionaires are successful because they were “lucky” or in the “right place at the right time.” In reality “luck” and being in the “right place at the right time” was the end result of their different thinking. The good news is that everybody can develop a millionaire mind set. A person just needs to be serious and committed to becoming wealthy. The same approach applies to having the right trading mind set. This section covers a variety of “mind set” articles.
To begin with use STOPLOSS and stick with them!
By using STOPLOSS you are getting out of the market on your terms before your emotions have a chance to cause you problems by staying in the trade too long and then getting out because you can’t stand another dollar of loss – which for example is usually the point where you possibly should be getting ready to enter your next trade. The profitable trader usually can calmly follow the market where ever it goes thus exploiting those traders getting out of the market on emotions.