How do you master you emotions in trading? and how are you supposed to journal for trading (analysis and psychology)?
Humans have evolved to avoid pain at all costs, as it’s a precursor to losing life. Therefore the brain has developed to provoke emotional fear if and when pain is likely to occur.
You will find that in every activity, including trading. That’s why traders avoid cutting losses by hoping the trade will reverse and not cause pain. Greed is another emotion, which triggers a Fear of Missing out (FoMo) response. And so is needing to be right all the time, which triggers revenge trading, overtrading and capital extinction - anything to avoid pain.
So how do you control your emotions? First of all, by understanding yourself, and what triggers an emotional response. Then, train your sub-conscious not to react to a trigger scenario. Walk away from it.
Once you have suffered, change your mindset to ‘okay, I got it wrong, but there’s always another trade awaiting’ and churn out the new trade as though it is one of a whole army of identical robots who follow your process exactly to the letter. Some will win and some will lose, but that’s normal.
I’ve conquered painful reaction by cutting losses early by telling my subconscious that I hate losing, but I hate losing big, more so. I will use the savings to fund a new robot trade - and so on.
I hope that helps.
i keep a day journal for every trade I make and why I selected it, like writing a book with what happened and what I experienced throughout the trade’s journey into the market. Even include what the markets were doing and what news was being reported.
I catalogue my feelings, mistakes, learnings, and results, and future outlook for the next day. In one year’s trading I have written 25k words. I’ve named it ‘THE FOREX VORTEX DIARY’ - and tried to make it interesting…
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If I can summarise what @steve369 is saying it’s that we are biologically programmed to do the wrong thing in trading.
There is no quick fix, save a frontal lobotomy. If that is not an option you don’t like the sound of, then try to retrain your belief system around such things as money, success, failure.
This can be done, through things like NLP and probably sustained meditation.
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Also read Bulletproof trader by Steve Ward. FREE on Youtube.
Hey racj17
This is one of the biggest trading challenges.
Here is an excellent article that I liked. I hope it will help you.
It is important to use experience to help your emotions. The more you see it with your eyes the more you’ll trust it. Go to youtube and you will find lots of different types of journalling
Thanks guys, your responses were all very useful. I’ll definitely apply to my trading journey moving forward