The distance between you and your trading success is the distance between your ears. Your mindset is key. Trading isn’t easy but it’s not nearly as difficult as many try to make it. Understanding these 7 psychological facets of trading is crucial. Let’s dive in.
The Number 1 Psychological Facet: "We Are Not Made To Trade"
That statement is fodder for an entire book, even volumes. The bottom line is that as human beings we don’t operate well in environments where we don’t have a reasonable control over the situation. Many of the same things that make you successful in life are the exact things that will hinder your success as a trader. This can be tough for the educated and motivated-which you are, otherwise you wouldn't be reading this column. You became successful by taking action, controlling the situation, and applying a high degree of logic. Unfortunately, these traits can often be detrimental to your trading account.
At times when there are no opportunities you’ll feel pressure to do something. You’re not lazy. You’ll also feel pressure to figure out exactly what happens next. Unfortunately, as I preach, no one knows exactly what a market will do next-not you, not me, and not the guy who screams on TV. This is actually liberating. The pressure’s off. Since no one knows you can embrace the fact that “not knowing” is okay.
Number 2: Experience isn’t always the best teacher
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