The thinking process of the brain relating to the psychology of trading involves:
-- Beliefs
-- Feelings
-- Values
-- Dispositions and
-- Faith
The positive or negative energy brings power to a person's actions, which ultimately determines whether a person is a winner or a loser. You can change for the better or for the worst. The old saying goes: For as a man thinks in his heart so he is.
-- Trading is the most difficult money making skill to master, because the market represents the aspects of people and life.
It is necessary to scratch the surface and explain what psychology means and how it relates to trading. Without doing so, you will not understand why this element is important to your trading plan.
The psychology aspects of people are separated into two categories:
1. Believers (the first category) who support the belief that something in the realms of other dimensions in the universe exist and
2. Non-believers (the second category) who are convinced that reality is the only dimension of life.
It is (the first category) that usually uses both sides of the brain to think and has access to a third component of the brain (faith) that is dead when the person is born. (The second category) only uses a small portion of the brain's power. While (the second category) may or may not use both side of the brain to function, the third part of the brain (faith) is completely dead and non-active.
See, the psychology of the brain is separated into three separate parts:
1. Faith
2. The thinking factor and
3. The emotional part.
If the thought, (focusing on the power of positive thinking), division of the brain controls the emotions, the individual maintains and develops discipline. If the emotions run the thinking part of the brain, the human being lives in a pure state of extreme confusion and disorder.
This is why the answer to success is understanding how the correct forms of discipline work - without it you will lose your shirt in the market.
Discipline in the following three areas of trading will ultimately determine your trading success.
* Training --- The successful trader never rests on past successes, or believes that his trading ability has peaked. He is always learning and practicing his decision-making skills, honing them until they become second nature. Then he can react faster than a speeding bullet, but with the benefit of superior human judgment.
* Trading Rules --- The successful trader develops set of trading rules - a plan - that he follows faithfully. This guides his decision-making at all times. If a trader's plan dictates that it is time to exit a stock, the trader will exit that trade and not wait a minute longer.
* Self-Control --- Successful traders display an extraordinary amount of self-control. Keeping emotions constantly in check, the disciplined trader is immune to the highs and lows that attend large market swings - whether panic, in a downturn, or of euphoria. I will show you how to learn the secrets of discipline.
Can You Learn Discipline?
The big question here is whether you can develop the discipline you do not have naturally. I believe the answer is "yes, you can," but you must have the necessary commitment to do so.
Ultimately, undisciplined behavior is going to be punished by the market.
Private traders who persevere and master self discipline, have external stimuli that will help the process. However, the market does not help as much as it might, because of the principle of random reinforcement. It is the market's tendency to reward bad behavior from time to time.
This crucial fact is one of the reasons why it takes so long to learn how to trade. You need to realize this: there is no point in having a system if you are not going to follow it. Follow and develop a routine of self-discipline and you will be successful in your trading ventures.
-=-=-==-=-=-=-==-=-=-=-=-=-=-=-=-=-=-=-
David Jenyns is recognized as the leading expert when it
comes to designing profitable trading systems.
His most recent course Ultimate Trading Systems is a step-
by-step trading roadmap to designing profitable trading
systems. Learn how *you* can become one of his students.
Click Here ==> http://www.ultimate-trading-systems.com
Receive David's free trading tips by sending a blank email to:
==> http://www.ultimate-trading-systems.com
-=-=-==-=-=-=-==-=-=-=-=
-=-=-=-=-=-=-=-
Suppose your position has made a big move and you... Read More
As a novice trader, you'll often feel the need to... Read More
According to Investopedia Inc. the penny stock market has seen... Read More
Over the past few months, several investment professionals have brought... Read More
Are you paying any attention to your retirement savings? Do... Read More
Reach in your pocket and take out that big roll... Read More
The Law of Chaos is the theory of random unpredictable... Read More
Robert Rodriguez likes to buy stocks at their lows. When... Read More
On the 40 year journey through the turmoil of a... Read More
Everybody is riding the Wall Street Roller coaster. Even if... Read More
Should the market turn against you, it is important that... Read More
A colleague of mine just returned from a scuba diving... Read More
People are constantly asking me why is the stock market... Read More
Ever wondered what is a mutual fund? A mutual fund... Read More
Profitable day traders recognize that momentum trading is among the... Read More
How often have you come across an advertisement or e-mail... Read More
There is a current movie entitled "Eternal Sunshine of the... Read More
One of the big advertising kicks today from mutual funds... Read More
First let's see what protectionism is. According to Mr. Webster... Read More
Much like the middle child, mid-cap stocks have long struggled... Read More
Time to look back2004 is over, now we are in... Read More
Wall Street's watchword has always been diversification, but what does... Read More
One of the most believed bits of conventional wisdom from... Read More
(1) Stock Market is Tough Place to Make Any Money... Read More
Well, not really. What I mean is I don't mind... Read More
O'Hare Chicago prom limo ..One of the great truisms of Wall Street is "Don't... Read More
I am taking the time to help others learn the... Read More
We all know that emotions control every decision that an... Read More
Financial markets provide their participants with the most favorable conditions... Read More
When it comes to buying a stock or mutual fund... Read More
(1) CHK stock price $16.74, NAV $32.5CHK is my favorite... Read More
Every broker and financial planner will tell you that you... Read More
When you become interested in a stock or mutual fund... Read More
Who are the successful investors?There are those who follow the... Read More
You must take the time once a month to review... Read More
Reduce your investing and stock market risks by:Setting your sights... Read More
It seems that every day I turn on the TV... Read More
The bear market that showed up at the end of... Read More
Mutual fund investing is a lot like Thai cooking. Everyone... Read More
The higher the market goes the more confusing are the... Read More
Just about now everyone is confused as to which way... Read More
Being wrong is OK, but let's not carry it to... Read More
When you stand on the ocean shore and watch the... Read More
One of the basic laws of physics states that a... Read More
Let's hope you did not have any of the Enron... Read More
How many times has this happened to you? You're at... Read More
People are always asking me when should I sell my... Read More
A few years back ? it seems like an eternity... Read More
Never lose money in the stock market again. Yeah, I... Read More
As one of my regular readers you know I have... Read More
Stocks & Mutual Fund |