Have you had one of those days where nothing went right? Perhaps you thought that Monday’s malaise would drag into Tuesday but unexpectedly saw the markets surge. Perhaps you were a little unprepared and the sudden change in market conditions ruined a few trading plans. Maybe you lost a little more than you had planned. Throughout the day, you were frazzled, frustrated, and dazed. If only there was a magic pill that you could swallow and regain your composure. Unfortunately, there isn’t.


Trading the markets requires a focused, calm mindset. You have to look at the markets objectively, and gauge the ebb and flow of the market action. It’s hard to do when you are thrown off balance. Since there is no magic pill, what can you do? It may not happen instantly, but you can practice regaining your composure with thinking strategies. In some cases, it is easy to regain composure: You can just take a quick walk around the block to get away from it all, calm down, and you will snap back into the proper state of mind. At other times, however, it isn’t that easy. Your mind is engulfed by self-doubt. You feel frustrated and unable to think clearly. At times like these, a simple walk around the block usually doesn’t work. In these cases, you need to actively use thinking strategies to release you from the grip of distracting psychological issues.

Each person has his or her own psychological issues that surface during a frustrating day of trading. Some traders are undercapitalized and new to the business. When things don’t go their way, they are consumed with self-doubt, unable to take decisive action. For other traders, it’s a nagging feeling that they could always do better. They set high-performance standards, and they are constantly searching for new trading ideas. Others have unrealistic views of the markets. They don’t want to go where the markets take them.

They want to dominate and control the markets. They look for the certainty that just isn’t there. A related expectation is a belief in an American work ethic. They believe they put in a good day’s work, and they should be rewarded in proportion to their time and effort. But time and effort alone don’t always pay off. All these expectations are reasonable in everyday life, but not when trading the markets. It’s easy to allow them to intrude into your consciousness and take over.

Combating psychological issues, no matter how small, takes effort. You must actively engage your mind to counteract them. When you are consumed with self-doubt, for example, you have to tell yourself over and over that you can trade profitably. And you must use your off hours to convince yourself that you can truly do it. If you can’t because you don’t have the skill to trade in the trading style you are trying to master, or you are clearly under-capitalized, you will know it, and you will waste your time trying to fool yourself into believing something that isn’t true.

But if you truly believe you can make it and are merely thrown a little off balance because a few things did not go your way during the trading day, then you can get back on track if you change the internal dialogue you have with yourself and repeat over and over that, you can make it if you try harder. Similarly, if you strive for extreme perfection, it’s useful to remind yourself over and over again to ease up. When you do, you will calm down a little and will regain your objective state of mind.

The markets won’t live up to your expectations at times. They won’t treat you fairly, and you are bound to face setbacks. It’s important to remember these facts of trading and remind yourself over and over again of their validity. If you do, you’ll stay calm. And when you are throw off your game, repeating these facts of trading will allow you to regain your objective state of mind. And once you are back in a focused, objective state of mind, you’ll be ready to take advantage of the many market opportunities available to you.

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