Psychology is the ONLY thing that separates the Pros and the Wannabes

One of the most underrated yet the most comprehensive subject is Psychology.Many have gone into the market getting killed(metaphorically speaking)without acquiring the mindset of a Trader.
It is imperative that one condition their mind to a Trader mindset first. So how do we acquire this skill? I wish it could be as easy as a snap of the fingers but it ain't.For the majority(like me),many of their subconscious belief on how life should be,is a total contradiction to the market dynamics and perspective.Worst,some of them have certain beliefs that are so ingrained in them that it acts as a counter productive force whenever they do a trade. Let me give you an example: A Pro trader genuinely do not mind losing money in a trade because he knows trading is base on probabilities/numbers game and when the odds are against him, he sells it for a manageable loss.,but for a novice,in his mind,he MUST win on every trade and when the direction of his trade goes against him,what novices do is this: clasp their hand and look up at the sky and say,"Please help..." while their money gradually diminishes bit by bit. These almost surreal way of thinking is very common. This character trait is embedded in most of us because we grew up in an environment where sympathy is a factor in our social circle.I'll give you an example: Remember the time where you could extend your curfew time by pleading with your parents? or negotiate to someone about something,so that both parties can come to an agreement? and many more situations that allows you to experience the sympathetic factor.So subconsciously,it is telling you that the markets behavior should be aligned to what you face in life which is the contrary.In life,if you set a target,it is possible to reach the goal,because you are able to control the external factors to a degree where your mind sets.For example,if you say you want to have a 100 bucks today,all you have to do is dig some stuff in the store and sell it in the flea market.Where else traders are flexible in their goals and expectations because they solely depend on what the market gives.The only guarantee are their rigid rules that are executed without hesitation.No trader in the right frame of mind will tell you that they force the market to give them money.And as funny as it sounds,I know this is happening to most traders (I know because I did this without realizing) But the mindset of a Trader is a completely different blueprint.Contrary to popular myth that Traders "make" a lot of money,they actually HARNESS the flow of the money. Relate a trader to a fisherman.He can't "make" fish,all he just do is caste the net over an area where he feels(after analyzing) there is a high probability of fishes.Although some of you might think this kind of thing won't happen to you,subconsciously you'll do it without consciously realizing. On hindsight,it's easy to say that you'll cut your losses but try to do this "easy skill" when you trade.Until you are able to accept the truth about trading-Wins and losses are a random distribution in trading, you will be always trade with fear and illusion resulting in inconsistency.
When you place a trade,you have to check yourself for Fear.When you have fear,either you are putting too much money on the line,you don't know what you are doing or you haven't accept that losing is a inevitable component of trading. When you still have the feeling of fear or you haven't genuinely accept the truth about trading..., it just says that you have yet to reach the Trader mindset. And it's perfectly OK! Nobody was born with the mind of a Trader.The best Traders persevere,learn and gradually condition their mind to have the proper Trading mindset.If they can, you can too...

PS:A book to compliment the conditioning of your mind to a trading mind would be "Trading in the Zone" by Mark Douglas.From my perspective,this is the best Psychology book you'll ever need.I've read it thrice because it really improve my performance as a Trader. 5 Star.

Cheers
Hyzel

"A loss never bothers me after I take it. I forget it overnight. But being wrong - not taking the loss - that is what does damage to the pocketbook and to the soul. "

Jesse Livermore