What a fascinating trader
Trading is a fascinating activity.
There are so many layers to it. And so many paths that you can go down.
Soon after we first got interested in the stock market I became captivated by technical analysis. I finally felt that I was in control. It gave me great confidence to have all these tools to use.
We bought some expensive charting software and I started playing with the hundreds of indicators that it contained. Exotic sounding devices with impossible to understand mathematical formulas.
So, armed with all these new tools, I was sure we would be making a killing in no time. Because now we had science on our side!
And so I spent night after night, weekend after weekend trying to understand them. Backtesting. Trying one and then another.
But still we struggled to pick the winning trades.
I can remember buying this add-on to our software that gave us even more indicators. And I was convinced this would finally make the difference.
So I tried yet more indicators. Using different settings and different combinations.
But success still eluded us.
Overcome your own fears in the market
at a great statement!
I just heard someone use it in the context of personal and financial success and it struck me as a brilliant summary of an issue we raise in the SMG Tutorials.
Fear is a huge issue with a lot of traders. And interestingly, not just fear of failure but also fear of success.
I think there are two keys to taming fear [you can never eliminate it so don’t even try!].
The first and most critical is the one noted above – action. Action can tame fear in an instant. But it needs to be the right sort of action.
If you have a fear of heights, going bungee jumping may not be the best way to address it! But standing on a high bridge is a good first step.
In the same way, if you have a fear of losing your trading account, trying to face it down by putting it all on the line in one trade is not the best sort of action.
But taking considered, appropriate action [like the strict use of stop losses] is a way of taming fear. And getting past the paralysis stage that fear can create.
The second key is focus. By this I mean keeping in the moment and concentrating on the immediate action that is required to move you forward.
If your focus is too broad you can become overwhelmed by the possibilities. Or you might start to worry about things that are beyond your control or simply don’t matter – like what
But when you narrow your focus and remain “in the moment” in regard your trading, fear will be sidelined. The simple reason for this is that you can’t concentrate on two things at once!
And again, this will help overcome the paralysis that can be created by fear.
So if you suffer from fear in your trading – action and focus are the key!