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Strategies Every Trader Uses to Master Their Emotions

Financial markets are like a roller-coaster. They bring both the thrill of winning big and the fear of losing everything right at once. The range of trading emotions can be extremely wide, especially when it comes to scalping. Swift trading, or any other type of day-trading approach.


One should be ready for emotional turmoil and significant stress. They are an innovative part of trading. The only question is how you are going to handle those emotions. When a trader can keep excitement and fears under control, it is the first step to establishing emotional balance strategies that can lead to success.

In this article, we will share 5 crucial steps that will define your future trading psychology and let you act with confidence in any market.

1. Step Outside Post-Trade for a Mental Reset

Traders need to keep focus when opening either long or short positions. You need to be 100% sure you do the right thing following your trading plan. So, a step outside post-trade for a mental reset will let you give your spirit a new boost of energy.

Simply, take a walk after each trade. Even a few minutes away from endless trading charts will prevent you from getting trapped in the ocean of emotions. All professional investors take regular breaks to walk away from the trading screen. It helps them regain the needed trading tempo and keep it under control.

What’s more, it helps one keep fit. Beginners should never ignore the importance of physical activities, especially when they decide to become full-time traders. Listening to relaxing music is also a good idea during a break.

2. Identify the Calmest Hour During Trading Sessions

Most beginners strive to dive right into it when entering the market for the first time. They choose the most volatile periods hoping to make the most of each trade. On the one hand, the majority of strategies work best during the busiest hours.


On the other hand, they come with maximum stress. Besides, congested markets often lead to frustrations, as newbies are not ready to trade under pressure. It triggers anger along with the idea of chasing losses.

If you see, the markets are moving unpredictably, take a break. Let your hair down with a favorite book and wait until the situation gets stable. When we say “read” something, it should not be mainly connected with trading. The idea is to take your body and mind as far from the trading screen as possible.

3. Implement a Three-Strike Rule for Wins and Losses

The three-strike rule is a concept when an investor gives up trading after three successful trades or failures. In simpler words, when you have 3 consecutive losses or wins in a row, you need to take a break. Otherwise, the chances of over-trade or over-leverage are high.

Three failures in a row can make beginners feel like losers. It makes their fears and anxiety explode. The only thing they want is to get revenge and regain losses. As a result, the only thing they do is chase the loss. Oppositely, three consecutive wins can make one feel overconfident, which sometimes leads to trading not following the plan.

4. Avoid Monitoring Profit and Loss In-Session

Monitoring profit and loss during a trade is another common mistake many beginners make. It happens because of the inability of taming trading emotions. As a result, novice market participants cannot cope with trading fear reflection.

Physiologically, figures that refer to wins and losses are the ones to cause the greatest surge of emotions. Sometimes, traders use them to evaluate their self-worth, which is wrong. Think about it. Aren’t you bigger than the greatest loss in your life? The same applies to wins. Sustained trading success leads to overconfidence.

No matter how much you win or lose. It should never shape your personality or change your state of mind. The best way to keep the situation under control is to use risk-management tools, set daily limits and stop losses, apply proper money-management strategies, and so on.

5. Self-reflect: "Is Fear Driving Me?"

Fear is one of the most destructive emotions one can ever have. It makes us doubt and feel distressed. Those are hardly the best qualities for people who act in the financial market. Ask yourself, what feelings drive you. Is it fear? Are you really scared to open a position?


If the question is “yes”, you should exit the market as soon as possible. Otherwise, you will never be able to avoid great failures. The only way to regain confidence and get rid of fears is to stick to the trading plan. Maybe, it is time to review some of its points or make necessary changes to let you get your confidence back. A good idea is to reduce the amount of funds per trade.

Achieve Sustained Success by Taming Your Trading Emotions

If you want to reach trading success in the long-term perspective, you need to learn how to master your trading emotions. Of course, it will not ensure the edge over other market participants. On the other hand, it lets you clearly analyze market conditions as well as strategy insights.

The above-mentioned tips do not provide the “magic formula”. Each person is unique in his or her individual approaches and mental state. However, investors are supposed to be persistent when gaining control over their emotions.

The fundamental tricks include taking breaks to rest after each trade. It helps to enhance mental clarity and gain better perspectives on upcoming positions. Positive self-talk works whenever you need to get rid of negative thoughts after a loss. Just make it as affirming and constructive as possible. Beginners should not praise themselves for every win or feel sorry in case of a loss.

Last but not least, journaling each trading action and steps you take within an applied strategy will make a difference. It is actually the only way to evaluate the overall performance and define the trading success in the long run.