Trading is similar to playing sports at an elite level, they‘re both mentally demanding. In fact it is quite common in sports for a highly gifted athlete with a compromised mindset to lose miserably against a much less talented competitor utilizing the proper mindset.
Trading is the same way. You can know everything about charting, indicators and options. You can have the perfect plan. The market might even go your way, but if your mental game is poor then you don’t stand a chance at making it long term as a successful trader.
Let’s take look at a common mental error that lead traders to poor performance, lost trades and sometimes even lost hope.
Mental Error: Being overly concerned about winning the trade.
Being over concerned about having to win an individual trade dilutes our focus. A good trader considers all the possibilities and creates a detailed plan prior to entering a position. Once the position is entered, his sole focus should be on executing the plan. Anything that takes his focus off the plan reduces his performance.
When we take our focus off of our plan and put it on the “need to win”, the plan goes out window. Without the plan, we get stressed. Our imagination runs wild. We begin making predictions and assumptions based off of made-up information. This inevitably leads to premature adjustments and exits, or worse, drastically delayed adjustments and taking on excessive risk. It’s a downward spiral that is very difficult to get out of.
Instead of worrying about winning, trust the process. If you’ve done your homework and have created a solid plan, then simply focus on the process and the results will take care of themselves. Execute your trade plan step-by-step thinking only of the next step to take. As soon as you notice yourself worrying too much about the final outcome, promptly redirected focus back on your mission of mastering the here and now. Trust that over time; even if this trade is lost, you will experience much better results “doing the right things” than you ever will worrying about the outcome.
And for those of you who are entering trades without a detailed plan? Just remember that trading without a comprehensive detailed plan IS planning to fail. And over time, that’s what you’ll get.
For more information about how to become a top performing trader visit www.lockeinyousuccess.com
John
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