Help me guys

[Moha 0]

Hi guys I have a trading psychology problem

Right now I have such a big fear of failing in trading

I am also afraid of being wrong in my analysis or trades and I am afraid that my knowledge is wrong (I have been studying trading for 2 years)

Can any of you tell me if this is normal and how I can fix it please

[Roman K 0]

Are you journaling/recording your trades? This should give you an indication if you are on the right path. 

[Abiel 474]

Sim + journaling. 

[DenHei1 13]

Listen to Rande Howell's webinars.  I just got his book on audio format and it sounds amazing.

You are not alone.  Trading is the greatest challenge to your mindset, identity, beliefs, fears.... just all your inner shit... that there is.  Just know that it is normal AND it's a journey to "fix" it.  Also listen to, and read Mark Douglas.  

Another thing - that is easier said than done - trade mechanically.  That way you can begin to separate your execution from your strategy - to see where the holes are.  

Hope this helps.

Hang in there.

Denise

[Angela Kuzeva 23]

These are common limiting beliefs which we all have. 

Afraid of being wrong - usually translates in life in aiming for perfectionism, seeing mistakes as a failure instead of an opportunity to learn from them, seeking external validation that you are good enough in this case from the market and your trading. There are many others, but these are one of most common. 

Fear of failing and doubt in your knowledge translate in low self-confidence, lack of belief in your strategy, attaching your self-worth to your trading results. 

What is your automatic response in the market to these beliefs - it can range from hesitation to take a trade to impulsiveness, revenge trading, overtrading etc. 

One way is to write down your thoughts and feelings before and during each trade. If you didn't follow your rules or made a mistake or had a losing/missed trade before what is the action, you took in the market. For example, I felt frustrated because I took a loss on my first trade today. Next, I entered without waiting for a confirmation. I regretted and felt anxious not to take another loss. I moved my SL quickly and I was wicked from a profitable trade. 

Over a month or two, you will start seeing patterns and will know your triggers and how you subconsciously respond to them. This exercise brings you awareness, without awareness you can't change anything.  Once you know your triggers and automatic responses you can create a plan when this happens what you are going to do. For example, you find that you jump on the next trade quickly after a losing trade. This shows you; you are not able to reset yourself quickly to neutral after a losing trade. So, you may implement a 10 min break before the next trade after a losing trade. 

Along with the above you must forget about the money and winning or losing trades/days. Your main focus must be following the strategy criteria and rules. The easiest way is to have a strategy with very strict rules including entries and exits. You focus on executing it flawlessly instead of winning or not and how much money you make it. When you execute a trade according to all rules and doesn't work, this doesn't make you feel as a failure because you have done all right and you know market is random and not all strategies work 100% of the time. 

Setting a daily goal is another tool. by that I mean not a goal of having a green day or 2R goal. These are outcome goals, and they bring only stress, and you can't control the outcome of these goals. 

You daily goal can be taking max 3 trades per day or taking only A+ set ups, or even as in the example above taking a 10 min break after a losing trade. You track your progress on the goal. It is better to have 1 or 2 max goals per day and work on them until you become consistent. You must be able to control the outcome of the goal. These are called process goals, they can be psychological, habit goals, trading goals. Start small and aim for a small improvement every day. by tracking your process goals, you start seeing progress and your self-confidence and self-belief start growing. 

[Daniel Thomas 22]

You WILL be wrong....often...  Being "right" all the time is NOT the goal.  The goal is to understand that with a reliable strategy, the statistics/math favor you as a trader OVER TIME (REPITITIONS). 

In the world of trading you're either the gambler, or the casino.  Your goal should be to identify/leverage a statistically predictable strategy/scenario (ie: "technicals"), then use said strategy to do the same thing over, and over, and over, and over again...

If you flip a coin, for example, you have a 50/50 chance of hitting heads, versus tails.... on any given flip..

If you demand $1 for every time you're right, and are willing to pay $1 for every time you're wrong -- statistically, you'll end up break even.  

If, however, you demand $2 for every time you're right, and are willing to pay $1 every time you're wrong -- statistically, you'll end up profitable...

Example with 10 flips: 

flip 1: you lose $1

flip 2: you lose $1

flip 3: you lose $1

flip 4: you lose $1

flip 5: you lose $1

flip 6: you win $2

flip 7: you win $2

flip 8: you win $2

flip 9: you win $2

flip 10: you win $2

 

In this example, you were right 50% of the time (as statistically expected).  Yet you walk away profitable: 

 

5 flips of Losses = $5

5 flips of Gains = $10

-- --- -- --- - 

Equation: $10-$5 = $5 (in profits). 

- -- -- -- --- - --

You were "right" 50% of the time, yet you still made money...  THIS IS WHAT TRADING "TECHNICALS" IS ALL ABOUT.  

Your goal is to identify a pattern/indicator/set of variables that is statistically predictable, THEN -- apply a reward/risk scenario to said situation, and leverage math/statistics to your advantage.  In essence, you're making yourself the CASINO, not the GAMBLER...

In the aforementioned example (the flipping a coin example), anything greater than a 1:1 ratio is a "good" reward/risk scenario (because the odds of you "winning" vs "losing" is 50/50.  I used a 2:1 scenario for simplicity. 

 

I used to have a pretty big YouTube channel discussing concepts such as this.  I don't like "social media," however, so it's always been hit & miss (with my content).  I do have a few videos that are still up on Youtube (the newest channel).  You're welcomed to peruse a few of them, and ask any questions desired.  Here is a link to a more popular video:  

 

In any case...  Just maintain focus.  Andrew and his crew are VERY GOOD traders.  My journey essentially began here (years ago), and I will forever be grateful for the leadership & mentoring Andrew provided.  Keep your head in the game...accept the FACT that you will go through ups & downs...and with the right amount of perseverance, dedication, and DISCIPLINE -- you'll come out ahead in the end...  

GL; STAY GREEN!