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Emotions are one of the most talked about enemies of the novice trader. I say novice, because unless you have become a master of your emotions, you are still a novice. Experienced traders trade with a detached and unemotional mind.
If you've been trading for a while, I bet you have had situations where you just felt beaten. You then either came close to quitting, or you tried to re-assure yourself with positive affirmations which at the time felt like a waste of time. If you're a novice trader this is bound to happen, as your aim is to make money!
Feelings like this can cause you to trade impulsively, whereby you trade with too much risk at the hope of hitting a big winner. You do this because you may want that feeling of success, pride, adrenalin and so on. The problem with this is that should the trade go wrong, you can turn that beaten feeling into a more severe depressed state of mind.
Changing your mindset to become more detached is easier said than done but there are a few things you can do, and with practice and awareness, they can become a lot easier to implement.
Accept losses. You need to accept that losses will occur. Every single trader out there has to deal with losses, so thinking that you're alone when it comes to dealing with losses is just silly. Before you set out to trade, you should remind yourself that losses occur.
Now the trick here is not to expect a loss every time you trade. This is a negative mindset and believe it or not, if you expect to have a loss every single time you trade, your mind will play tricks on you and make you do things to support your belief. The mind is a very powerful organ!
Instead, rehearse how you will respond to a loss. Before you trade next, visualize placing the trade and then seeing price go against you and actually taking out your stop. Now monitor your posture, your facial expressions, how you are around other people, especially loved ones and so on.
If you're not happy with the way you respond, in other words you react, then visualize a different response. It will take practice but you do need to be aware of how you respond or react to losses, because once you become aware, you can prepare better and therefore practice a better way.
Once you become aware and change your response, losses won't hurt you as much, because you're prepared for them and you now know how you'll respond.
