Overcoming anxiety when trading
- The fear of losing money can stop traders from executing trades
- Changing the color of candles to just one color can help reduce anxiety
- ✦Using multi-colored candles decreases your ability to detect patterns.
- Visual perception in psychology explains that the brain looks for patterns and similarities in colors.
- Color affects your brain, emotions, and potentially your trading ability.
- To trade effectively, it is best to be in a neutral and unbiased state of mind.
- Fast-moving red or green candles have led to bad trades in the past due to anxiety.
- If you are anxious during a trade, use candles with the same color.
- To decrease reactivity to price moves, change the candle color to anything but red, blue, or green.
- Using a single color for up and down candles can help increase calmness and reduce anxiety.
- ✦Don't wait for the perfect entry point in trading
- Waiting for the perfect entry can lead to missed opportunities
- Perfectionism can lead to irrational behavior and drain mental energy
- Trying to time the entry point accurately is a foolish endeavor
- Using range instead of exact prices can reduce anxiety
- ✦Good traders are patient and wait for setups
- Good traders are alert yet patient when setting up
- They don't chase the market, they let the market come to them
- They use limit orders instead of market orders
- They identify the best prices to buy and sell beforehand
- Taking action only when conditions are as expected helps reduce stress and avoid emotional trades
- ✦Higher time frames offer more reliable signals
- Using higher time frames reduces stress and anxiety while trading
- Transitioning to higher time frames may be difficult at first but leads to better trading execution
- Trading a handful of high-quality trades is better than trading lots of poor-quality ones
- Day trading on lower time frames requires constant monitoring
- Lower time frames offer excitement and action, but can lead to mental fatigue
- ✦Avoid frustration and burnout by trading on higher time frames.
- Trading on higher time frames reduces the time spent in front of charts and lowers the risk of burnout.
- Maintaining a cool head and emotional discipline is easier on higher time frames.
- Avoid the frustration of stop-losses getting hit too quickly by using wider stop losses and lower position sizes.
- ✦Trading anxiety comes from not knowing what you are doing.
- Lack of trading strategy, plan, and journal.
- Not being confident in your own ability to trade.
- Feeling fear when you trade.
- Importance of using a trading journal to track performance and emotions.
- ✦Understanding the process of making and learning from mistakes is crucial in trading.
- Track patterns, emotions, and feelings in your trading journal.
- Consider the benefits of losing and learn from big losing trades.
- Understanding why you're winning and why you lost is essential to repeat success.
- Changing your perspective on losses can lead to repeatable wins in the future.
