BE A FEARLESS TRADER

No One Is There To Threaten In The Market, Yet Some Unkown Fear While Trading. Why? 

In your trading career, no matter long or short, you might have witnessed an unknown fear. Fear while taking a trade on the trusted setup, fear while carrying over your winning position. But why does this happen? Because you have an unknown fear, even though no one is pointing a gun at your head when you are on your trading desk. In today’s blog, we discover why this unknown fear grips us and how can we overcome it? Are you ready? Then read on…!! 

You Don’t Have A Defined Stop Loss.

The fear psychology doesn’t develop within one day. The fear within traders is built upon by taking and staying in losing tradies, over and over again. You can conquer your fear while trading by including discipline in your regime. Now how do we define discipline while trading? Well, you have to start considering your stop losses when you enter a trade. Before you enter any trade, pre-decide a stoploss in your mind. It would be great if you put it in your system while taking a trade. When you consistently trade with defined stoploss and target, you learn to be disciplined. And when you are a disciplined trader, fear of the unknown can’t grip you while trading. 

Have A “Enter-Again” Point While Trading.

If you are experiencing a constant fear of facing your stoploss and your trade moving in the direction of the target, you need to set up a point for entering again. Now, how does this work? Well, say that you are trading a volatile instrument like Bank Nifty, and you are on the long side. Now you know, Bank Nifty and most volatile instruments have a habit of feasting upon stop losses. Now, if your stoploss is hit, and you see the market moving towards the direction of your target, you need to have a safe point above which you will again enter your trade. 

Let’s understand more about this in the virtual example below. 

In the above picture, you can see that we hit our stoploss, but instantly, the market started moving in the opposite direction. Instead of entering at a random place, we decided to enter when the price retraced the yellow horizontal line. As a result, we booked good profit on our long position. 

You can also trade freely without worrying about your stoploss getting hit and even earning after your stoploss got hit. You just need to know the right strategy to make money in the market. Do you want to know more about these strategies? Join TCI’s pro mentorship program. 

You Are Too Worried About Everything, Other Than Your Trading Plan. 

Operators, SEBI Margin Rule, Stoploss Hunting, Freak Trades, Margin Penalties, and words of these kinds keep on floating in your mind. Now, you need not worry too much about all these things. These things exist in the market to take your mind off your rightful trading plan. To be precise, you need not worry about these things, but only your trading plan. If your company is with such people who keep on blabbering that SEBI is ruling out retailers of the market, and the operators are always up for taking out retailers off the market. 

Plan Your Trade & Trade Your Plan 

If you are not planning your trades a day before then, you are definitely going to have a fear factor while trading. You need to make a trading plan that you will follow, no matter what. Study your charts until you get to know the clear picture of every movement in the market. Moreover, you should study your charts on the front of multiple time frames to get more clarity. Doing this will have no place for fear in your subconscious mind when you trade. 

Make your trading plan rigid and flexible at the same time. Your trading plan should be rigid, as in, it shouldn’t get affected by anybody’s opinion. At the same time, you should also be flexible in accepting that your trading plan is not working out, and then you should work out to make your trading plan successful. 

Don’t Jump To Take Trades…!! 

If you are taking multiple trades, even worse, ten-fifteen trades in a day, then you are not trading the right way…!! Do not jump on and punch the trade every setup you see or hear about…!! Instead, you should only take the trades that are right as per your personal setup. This will give you more confidence while you punch in the trade, and you will have the guts to stay in the trade…!! 

Position Sizing Matters. 

If you are taking trades bigger than your pocket size or more extensive than what you can afford to lose, then you are in for losing more. Moreover, immense fear will cripple you if you keep on trading with oversized positions. While trading, always remember that you should stretch your legs as per the blanket. Always stake what you can afford to lose. As Mr Jhunjhunwala says, make mistakes, but only make those you can afford, and live long enough to make new ones…!! Know that trading is a business and not a casino where you will try to risk big and win big. Mr Market easily thrashes these types of traders with a harsh beating…!! 

Trade Technicals & Not News. 

If you are also trading with news, you are sure to sign up for being a trader who constantly is ruled by their fears…!! Instead, you should leave news based trading far behind and focus on price action…!! 

For example, a few days ago, there was news in the market that Airtel was offering rights issues at the rate of 535/-. Now most retailers were worried, and some over-smart ones wanted to short Airtel with PE. But price action was telling a completely different story…!! 

The blue lines are the essential Fibo levels, and Bharti Airtel reacted just right on these levels…!! So an excellent technical trader would have gone long and booked super…!! 

Conclusion

So these were the facts that can help you overcome your fear while trading, and you can become a great trader by following all the above tips by heart. Want to know more secrets about being a profitable trader? Join our mentorship program.

To learn how we and our students trade consistently, do check our mentorship program through the below link:

https://tradingcafeindia.com/mentorship

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