Welcome to The Blueprint to Trading Psychology
Before progressing, I want to make it very clear up front that this book is for those who are willing to put the work in. My aim is to give you a framework, a blueprint, and actionable methods to help solve psychological problems and everything else that can affect a trader’s mindset.
In this book, I am going to share with you all the things I learned and applied to my trading which helped me personally succeed. I will be going into why you think the way you do, methods to break down the problems with exercise, and mental models to greatly improve how you view and overcome them.
My hope is that even if you come away with one thing that helps improve your trading mindset then I have done something worthwhile.But this will be useless unless you apply the methods presented in this book. So, make a conscious effort now that you will give this 100% of yourself and apply the methods. You must make the decision right now to be willing to be open-minded and take responsibility.
‘’For things to change, YOU have to change.
For things to get better, YOU have to get
better. For things to improve, YOU have to
improve. When YOU grow, EVERYTHING in your
life grows with you.’’ – Jim Rohn
1. Develop emotional intelligence The first step to successful trading psychology is developing emotional intelligence. This involves learning how to control your emotions when trading, so you can make clear-headed decisions. Emotional trading can lead to impulsive and irrational decisions that can negatively impact your trading results.
2. Create a trading plan Creating a trading plan is a crucial aspect of trading psychology because it helps you stay focused on your goals and objectives. It should include all the rules and guidelines you'll follow when trading, including your entry and exit points, risk tolerance, and profit targets. Following your plan will help you trade in a disciplined and objective way.
3. Learn to manage risk Managing risk is another crucial aspect of successful trading psychology. It involves understanding the potential risks involved in a trade and knowing how much you're willing to lose before exiting the trade. This will help you avoid making emotional decisions that can result in significant losses.
4. Maintain a trading journal Keeping a trading journal is an excellent way to improve your trading psychology. It will help you keep track of your trading performance, identify your strengths and weaknesses, and develop a better understanding of your emotions while trading. Reviewing your trading journal regularly will help you fine-tune your trading plan and refine your approach to trading.
5. Practice self-care Lastly, practicing self-care is an essential aspect of trading psychology. It involves taking care of your physical and mental health, getting enough sleep, and taking breaks when necessary. Trading can be a stressful and demanding activity, and it's essential to take care of yourself to avoid burnout and maintain a healthy mindset. In conclusion, trading psychology is a crucial aspect of becoming a successful trader.
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