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Edward Gonzales • 18 February 2022
No Adverts are availableObtaining and maintaining an effective trading mindset is the result of doing a lot of things correctly. It usually takes a conscious effort on the trader’s behalf to accomplish this. It’s not necessarily difficult to achieve, but if you want to develop an effective trading mindset, you have to accept certain facts about trading and then trade the market with these facts in mind.
Have Strategies (tools) Ready
You need to know what your trading strategy (trading edge) is and you need to master it. You have to become a “sniper” in the market instead of a “machine gunner”. This involves knowing your trading strategy inside and out and having absolutely NO questions about what the market needs to look like before you risk your hard-earned money in it.
Manage Risk
You need to always manage your risk properly. If you do not control your risk on every single trade, you open the door for emotional trading to take hold of your mind, and I can promise you that once you start down the slippery slope of emotional trading, it can be very hard to stop your slide or even recognize that you are trading emotionally in the first place. You can largely eliminate the possibility of becoming an emotional trader by only risking a certain amount of money per trade that you are 100% fine with losing. You should expect to lose money on any given trade, this way, you are always aware of the real possibility of it actually happening.
Don’t Over-trade
You need to NOT over-trade. Most traders trade way too much. You need to know what your trading edge is with 100% certainty and then only trade when it’s present. Once you start trading just because you “feel like it” or because you “sort of” see your trading edge, you kick off a roller coaster of emotional trading that can be very hard to stop. Don’t start over trading and you will likely not become an emotional trader.
Documentation/Organization
You need to become an organized trader. If there is something that is the “glue” that holds all of the points I’ve discussed together, it’s that you must be organized. By this, I mean that you must have a trading plan and a trading journal and actually use both of them consistently. Plan your trades. Write down your thoughts before entering a trade. Write down if the trade won or lost. If it won, write down why. If it lost, write down why. Observe the results. Try to find a common theme or error to delete from your losing trades. Try to find a common theme or strategy that yielded the most wins and start scaling that method. The power of documentation and observation will astonish you.
Try to think of crypto trading like a business instead of like a trip to the casino. Be calm and calculated in all your interactions with the market and you should have no problem keeping the emotional trading demons away. You can view our homepage to discover more ways to fine tune your trading experience.
By viewing any material or using the information within this publication you understand that this is general education material, and you cannot hold any person or entity responsible for loss or damages resulting from the content or general advice provided here. Trading cryptocurrency has potential rewards, but also potential risks. You must be aware of the risks and be willing to accept them in order to invest in the markets. Only trade with funds you can afford to lose. This publication is neither a solicitation nor an offer to buy/sell cryptocurrency or other financial assets. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed in any material on this website. The past performance of any trading system or methodology is not necessarily indicative of future results.
Written by Edward Gonzales © Crypto University 2022
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