By Admiral Markets
Dear traders,
Do you sometimes find yourself trading in a bad or grumpy mood?
It happens to the best of us, but negative emotions do have a real impact on your perception of yourself as well as your
trading and your decisions.
This article will provide tips on how to break the negative spiral and how you can trade with a more balanced mindset.
Not everyone is convinced that negativity in itself is a negative aspect; they believe it’s a useful way to release internal pressure.
Free Reports:
I myself am not a psychologist, but I’m willing to share my experience.
According to Matthieu Ricard and his book
Happiness –– a Guide to Developing Life’s Most Important Skill, you are able to get rid of negative emotions consistently. He explains that “negative emotions are transitory mental events that can be obliterated by their opposites, positive emotions, acting as antidotes.”*
Does it happen overnight without any effort? No. It requires mental training, just like when we go to the gym to train the body or study at night to pass an exam.
Luckily, Ricard offers three steps how anyone, including traders, can improve their mental balance and well-being.
You might wonder why this is important for me and other traders.
From my experience, negative emotions are often the key element that leads to a string of bad decisions.
For instance, if you feel annoyed or sad when looking at the 1-hour
EUR/USD chart because it reminds you of your unlucky loss 2 days ago, it will influence your focus and your decision-making.
Time to discuss the solutions!
Recognising negative emotions will not be sufficient to solve the problem. Nor will hiding them. A more proactive approach is needed, according to Ricard, with a “new way to manage your thoughts.”*
His book mentions three solutions:
Applying all three methods will help traders free their mindset. It will allow them to counterbalance the emotional chains from their thought and help them focus on their decisions more productively.
The best advice that I can provide is to keep happy thoughts during, before, and after trading. Sure, some trades or days will turn into losses, but your trading capital shouldn’t be fully lost if you use proper risk management.
A positive mindset is better equipped to recognise opportunities, take informed trading decisions, and counteract against negative emotions, such as fear and anger.
This doesn’t mean that traders cannot learn from their mistakes. Having a positive mindset does not equal forgetting everything immediately. It means:
Trading psychology is a field that requires attention. Nenad and I address these aspects in our
live webinars courtesy of Admiral Markets who offer:
Cheers and safe trading,
Chris Svorcik
(*)
Happiness – a Guide to Developing Life’s Most Important Skill by Matthieu Ricard, publisher Atlantic Books in London, 2003, page 123
Follow
@ChrisSvorcik on Twitter for the latest market updates!
Connect with
Chris Svorcik on Facebook for more Forex and CFD information!
Article by Admiral Markets
Source: Learn How a Positive Mindset Can Benefit Your Trading Psychology
Admiral Markets is a leading online provider, offering trading with Forex and CFDs on stocks, indices, precious metals and energy.