Trading psychology, why it is a trader’s biggest strength (or weakness!)

Welcome back, Traders!

Today we are going to talk about the psychology of trading and why it is the single most important thing to get right if you want to long term make profitable trades

What do we mean when we say trading psychology?

As you start on your trading journey, you should soon realize that it is hugely

important that the psychological component of trading is viewed on the same level as trading strategy. Theoretical trading lessons become more complicated when you put them into action and this is something that can throw the novice trader off ‘their game’ to start with, just when you think you have everything nailed on, emotions creep in, rules get challenged, and you're back at square one.

Its abundantly clear that there are two parts to every trade: the trade itself and the trader (that is you, we presume if you are reading this!). Many traders spend their time focusing on trading strategies and techniques to follow, but these strategies are only as good as the person making them! If you want to achieve long-term success (we assume you do!), you need to focus on the "mental" game as much as you focus on strategy. Trading strategy can be refined by analysing chart patterns, setups and who to follow. Trading psychology is refined by focusing on you, the trader - the one who makes all of the trading decisions.


So how do I overcome it or spot the signs?

Day trading is a full on, leave the baggage of the last trade at the door, whether it won or lost it doesn’t matter, all that matters is the next one, you always need to be prepared for the next trade. If you focus too much on your wins, you become driven by your ego (this doesn’t mean it’s not great you won, just don’t let it make you arrogant!) If you think too much on your losses, you lose confidence and second guess the good work you have done with research and strategy.

You aren’t going to ride every wave of success you see in the news, from other traders or social media. This is nothing to worry about! Nobody can hit everyone, just focus on you strategies and enter where you have an edge through charting and research!

If you have a bad day, chalk it up to experience! An athlete could have a horrible day on the track- it doesn’t mean they decide to change sport, everyone has bad days, learn from it and move on!

Trading can be addictive and like gambling people can get sucked into risky trades, take control of your trades- if you’ve not researched or it goes against your usual strategy it probably means you shouldn’t get involved!


At Trading top ten we realize is a lot of the people that come here might only just be starting their trading journey and looking to us for solid advice, so here it is-

· Only Trade what you are willing to lose

· Trading is a long-term project, don’t base your abilities off one bad day (or one good one for that matter)

· A lot of people don’t care if YOU lose YOUR money, don’t follow the Instagram charlatans- remember they have either already made their money (or looking to make a ‘quick buck’ off you!)

· Create a system of trading that works for you, don’t go into each day without a strategy, 9 times out of 10 that will lose you money!

Whether you are starting trading tomorrow or have been trading for 10 years, at some point emotionally you have or will have decided without thinking it through and being rational (not even necessarily about trading!) so use our advice, take a breath and remember your systems and strategies and if you are still feeling irrational or overly emotional toward a trade even though it goes against those things, then maybe a day away from the screens to reset will help!

Be sure to join The Trading Top Ten Premium Ideas group, listen to our experts give their honest analysis of the markets, with at least 10 trade ideas a week giving you a chance to copy the experienced trader’s and listen to the reason they will be entering them!

Thanks for reading, your friendly Trading Top 10 team!