Emotions when trading - page 22
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Corrected...
My humble thanks. Would it be too impertinent of me to ask you to make paragraphs of three or five sentences each? That way your text will be very easy to read and understand.
Will do.
Roger that.
Will do.
Even the moderator couldn't take it.
Where do you put smileys?
I couldn't find any...
You live and learn... :-)
Where do you put smileys?
I couldn't find any...
You live and learn... :-)
Where do you put smileys?
I couldn't find any...
Download the gif archive with the smiley faces, and paste them into the image
That they reflect many aspects of life...?
I see. Can you recommend a resource where you can download a rich arsenal of emoticons?
That they reflect many aspects of life...?
How can profits grow from going into deficit? :-D That's why I moved away from it!!! Yes the general trend has to be seen. And follow it. But on a shorter period of time! How long it is depends on you. For some people it's better to trade on 15 minutes, for others on ticks. The bigger the timeframe you trade on, the more you actually get stuck! If at higher harmonics you can already see the beginning of the reversal and get out of the deal, then, as I wrote earlier, like a silly Masha or a giraffe from the joke at lower frequencies you will see this reversal already too late!!! That's where the emotions and psychology come in!!!
You wrote somewhere above that you're not chasing instant profits? What are you chasing then - a slow drain? :-D
Remember Elder again. He spoke about a stool consisting of three legs: analysis, risk management and psychology. Take away any of them and the stool collapses... I see, now you are thinking that risk management is missing in my trading. It is not completely absent (I open with minimum lots), but there is some digression. I wrote about it. At the very beginning of a capital life you have to take risks. And then, everyone has his own objectives. After taking a profit, the capital will be more than doubled (if the correction model fully works). And subsequent transactions will no longer be as risky. Capital ensures survivability. If the correction model does not work or does not work completely, the profit will not be large. But it is not a problem, because time goes on and there will still be a chance to hang the sells on the way to the target.
But back to the stool... I want to say more about one of those legs - the psychology...
As a rule, people who entered the financial market, and after several defeats continue to learn how to trade - are intellectually developed people. People are far from being stupid... It is not difficult to learn to correctly identify trends, properly analyze what is happening and make decisions. I'm sure every "stubborn" trader often correctly identifies the direction of the Market. But almost never gets to the point. The trend predicted by the trader develops without him. The trader has already lost his money and recorded a series of losses. Immediately after that the trader sees that it turns out he should not have touched anything.
In fact, there is nothing complicated about risk management. But almost everyone has difficulties with psychology. It is psychology that is the main barrier of success. It is very "painful" to a person to watch positions opened by him going into redemption. And with every fresh impulse in the trading terminal your account dies in quick convulsions. The trader who is sitting in front of the monitor is nervously shaking his leg, biting his nails and contorting his face ... But he can do nothing. He is seized by doubts. Sure, if he was right, it would be plus, not minus...
Either he lets the minus grow a bit, or immediately after the market "scared" him, the trader closes his position(s) and fixes the loss. In this case, the trader sees that he turns out to be right and the Market gradually moves in a predicted direction, though with some fluctuations (that is what took him out). It seems to me that the logic of defeat lies here. In fear. A person does not want to observe floating minus on his account. He wants to immediately see a floating plus, which must also quickly add up. I know how nice it is to see powerful bursts of profit. And how unpleasant it is to see powerful jumps in losses.
This is why Elder and other "Gurus" emphasise the so-called action plan. Earlier I asked to remember again the example from the book about the boss and the employee... Notice, you almost always analyse the Market correctly, which means you can make an action plan. You follow the news, you read analytics, you watch the chart on the monitor. You have more than enough of everything you need for a proper plan. You can even calculate possible profits and possible losses in advance. What's left is the easiest and, at the same time, the hardest part - how to get through it... How to psychologically survive the moments of rising and falling equity...?
And here is where the most interesting thing begins. Everyone has to find the "reference points" for himself, which will help him to keep "in shape"... We are all different, our lives are different, our world view is different... And so each of us has its own way in this context. The main problem has been identified. All that remains is to find a way to help us through it. It is enough to go through it at least once in your life, get the result, and it will be easier in the future. Further on you can add to it or, on the contrary, take something away. You can model in various ways. Everything will work here. Any measures and methods will do, as long as they help psychologically to overcome the fear of anticipating deficiencies in the account. Because there are no pluses without minuses. In most cases you may see floating profits at the beginning, but after a while they turn into losses, which keep on growing. This is not the case with me: at first I have a floating loss, which then turns into a profit and keeps growing until I reach my target.
When I hear moaning and shouting about how impossible it is to make profit on the Market, I immediately get the picture I have just described... :-)
If you want, I can send you my archive, but I have a different internal network, for you it will count as international internet traffic.