TRADING
How to Get Over Being Unable to Make Trades?
Experiencing trade hesitancy? Sometimes, you have to find a way to trick yourself around your emotions.
Trading is a very challenging game. Especially mentally. Sometimes, you’re on a role, but there will be times when nothing seems to go well for you. Hopefully, this will be more frustrating and not hugely expensive because you always manage risk, but it’s not pleasant either way.
I’m not a gambler at heart. Opening up to risk is painful for me, emotionally speaking. I don’t enjoy it. I have to force myself to do it. It’s almost effortless when I’m doing great and stacking up wins, but when times aren’t brilliant, I have to find a way around my risk aversion.
If you’re experiencing something similar right now, here are a few ideas for getting out of this rut.
Predetermine the risk you are willing to take on the trade and accept it as lost.
Now you know precisely what your downside is if you lose this next trade. You’ve given your boogyman a name and a number. See this money as lost, and make sure you can live with that scenario. Only risk as much as you are comfortable losing because none of us can “only” win in this game.
Understand and accept the inherent uncertainty of the markets.
The fact is that you can never really know if one trade is going to be a winner or a loser. We’re only ever dealing with probabilities here. You may think you know, but you don’t. And that lesson is coming for us all. It’s only a matter of time. You need to accept this inherent uncertainty and contain the danger by limiting risk in every trade in some way.
Define your strategy and make it mandatory to pull the trigger on the trade when conditions are met.
If you have a system of any kind, write it down. Don’t overcomplicate things, and define clear rules for this system. When your system indicates a potential EDGE trade, you must pull the trigger. One, two, or three conditions are met, which means it’s game time. Don’t overthink things, and just do it.
Lower the size of your positions.
This is the most essential part. You might feel unwilling to risk 1,000 USD on the next trade, but do you have the same emotional aversion to risking 100 USD? How about 10 USD? Probably not. Find your emotional threshold, and work with it. When you feel more confident, you can always increase risk.
You can also first open a “feeler” trade.
This is a small position, just big enough for you to feel something but not enough to hurt you if it goes wrong. Only you know what that number is. Put on that position (buy, sell) and then observe how it makes you feel and what the price does next. If you feel better about the position or the price indicates that you are right, add more to the position. If not, cut it for a small loss. Keep it simple.
When you are unable to open a larger position, it’s not the right time to bet big anyway. Your mind is compromised. You’re unsure. Don’t force things unless this is how you operate. Some people thrive by pushing themselves out of their comfort zone all the time. If this is your modus operandi, then by all means, have at it.
The rest of us might do well to tread lightly and ease back into trading bigger sizes after regaining some confidence and releasing emotional resistance to risk. There is some truth, though, that the best opportunities present themselves when trading is least comfortable. So, there’s that.
Good luck out there, and just get back in the game, even if it takes baby steps.
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