Many traders struggle with managing emotions. And that can lead to epic trading mistakes.
Maybe you’re in a losing position because you don’t want to take a loss…
Or maybe you chase a sketchy OTC that’s up with no news…
And it’s all because of FOMO.
Those mistakes can be costly and make you feel like you’re ready to give up.
Don’t throw in the towel just yet.
Successful traders learn to control their emotions.
Today I’ll share resources to help you tame those trading gremlins. Plus, I’ll share a tip that can help you limit emotional mistakes as soon as Monday!
Can one trading pattern up your trading game? Click here to find out.
Must-Have Trading Resources
Reminder: The market’s closed today. Use your time off well! This is a great time to study up.
Since we’re talking about emotions today, I’ll share a few of my favorite books on the topic.
First, one way to combat trading emotions is to build discipline — to stick to your process, stops, routines, and patterns.
If you want to build discipline in trading and all aspects of your life, read “Discipline Equals Freedom” by Jocko Willink. (As an Amazon Associate, we earn from qualifying purchases.)
No, it isn’t directly related to trading. But if you optimize your life with good habits, routine, and discipline, that can help you maximize your trading performance.
Another great read is “The Hour Between Dog and Wolf: How Risk Taking Transforms Us, Body and Mind” by John Coates.
It covers topics like how emotional mistakes can lead to big losses and how stress can impact decision-making. What I also love is that it delves into how winning streaks can fuel emotions like cockiness. And guess what? That can negatively influence your market performance, too.
I’ll finish with one of my favorites…
If you can only own one trading book, it has to be “The Daily Trading Coach” by Brett Steenbarger.
I think it’s worth every penny and it belongs in every trader’s library.
I like how it’s broken down into 101 short chapters. So even if you’re not a big reader, you can take on one short 10-minute chapter a day. That’s easy to do every morning while your coffee’s brewing.
Want more book recommendations? Get my top 7 must-read trading books here.
And watch the video below for more tips on controlling emotions.
Now, it’s one thing to read about keeping emotions in check. Putting that into practice — in live trades — that’s completely different.
Let me share a real-world example to help you out a bit…
How to Take Emotions Out of Trading
Random trading will yield random results. It will also stir all kinds of distress, with thoughts like…
What am I doing in this position? When should I get out? I don’t want to take a loss, so maybe I’ll just hold until I’m breakeven…
That can land you a lot of trouble.
Let me break down the Veru Inc. (NASDAQ: VERU) chart from yesterday as an example…
With this afternoon pattern, see how you have a defined risk level, entry, and profit target?
When the stock breaks through the morning high with volume, you enter the trade and risk the low made during consolidation. Then you look for a three-to-one risk/reward where you exit.
You have a clear plan to follow — no guessing games or what-ifs.
I break down this pattern for you more in this video…
But if you want in-depth analysis and more examples of this pattern — join me next Thursday. I’ll tell you how to spot it and get the most out of your trades.
Because once you focus on trading a proven pattern and strategy and trust your process, you can better control those destructive trading emotions.
And THAT is a game-changer!
Study up and read today. I’ll see you back here on Money Monday.
Lead Trainer, StocksToTrade