Trader's Queries - Trading psychology Part - 2

vanathi Mod Updated   
Today we are going to discuss 1. How emotions affect our trading? 2. How to take control of our emotions during trade? Apart from our trading plan our emotions are important for trading. We have a trade set up, we enter the trade when price moves as per our trading set up. For example we enter a trade at the price 400 with 395 as stoploss. Price reaches 405, we are happy. we
multiply the profit with the no of shares we bought. We imagine how to spend that money. Then the price falls to 395.5. We are desperate.We feel sad. Then the price starts to move steadily and reach our target. Now we are happy once again. If this trade take hours to complete imagine how long we felt happy, sad, desperate? Some of us close the trade when the price reaches 395.5. Then after seeing price hitting target we think why we close our trade before it hit the stoploss.
Now comes the questionn how to control our emotions. We can do meditation.We can do our work with concentration. Or we can understand the simple logic behind trading. After entering the trade price action takes control and we have to just watch whether it hits target or stoploss. Why to worry for a thing which is not in our control and what use in it? For example if a heart surgeon start to imagine whether the patient will survive the surgery, whether surgery would be
successful, will I do the surgery perfectly during a critical surgery means, imagine the outcome. It will be a disaster.
Another thing is we relate trade with money.Instead of thinking 5 pts stoploss 10 pts target, we
think 1000 rs loss, 3000 rs profit. When we think interms of money we can not succeed. Avoid negative people around you. And be true to yourself. Just calculate how many hours we spend for trading. 6.15 hrs is our trading time. In that we use whatsapp 30 mins, we chat with others 30 mins, we tell others I got this much profit/loss for 30 mins, we analyse whether others are successfully making money for 30 mins, we take rest 30 mins, we check mails 30 mins(All data are imaginary). After doing all thesethings we do trading. This is cheating ourselves. To be true to ourselves we should focus on trading rather than people around us.
Hope the traders who asked me these questions will read this post and give like or comment.
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