Have you ever entered a trade and immediately began to feel your heart pound, noticed that you were breathing heavily, found that it was difficult to maintain your concentration and on top of that felt a strong wave of anxiety travel through your body? Well, what you were experiencing are the effects of stress; and once they begin to affect your body/mind functioning you have gone over the threshold; that is, a demarcation or imaginary line beyond which a plethora of physiological, emotional, and mental issues start to pile up. Because the nature of trading is performance-oriented, which is extremely challenging as it relates to maintaining self-discipline while following through with plans and rules, becoming stressed is a common occurrence. You want to manage your stress in order to maintain calm, focused intention, and a connection to your A-Game.
Let’s begin by saying that stress is a necessary systemic response to a perceived physical, mental or emotional threat. For instance, when you are considering entering the market and perceive that the price action is becoming volatile you may interpret this as either good or bad. If your interpretation is that this is going to be positive for you, your emotions may become intensely excited and greedy, causing you to enter the trade impulsively and recklessly. In this instance, even though you attributed a positive meaning to the event, your unsupportive emotions still became activated by threatening unconscious thoughts that you might miss out. Or, you may interpret this movement of the price action as negative, which motivates your emotions to become anxious and fearful causing you to avoid initiating a clear set-up as you feel threatened by the prospect of losing in the trade.
Consider this situation: Samantha couldn’t believe what was happening. The trade began on a positive note…so she thought. She had seen what she surmised was a price pattern; an ascending triangle, which looked to hit the top of the resistance line several times and the bottom trend line was about to touch. She heard herself say, “… this is about to break up.” She entered long believing that this continuation pattern was “definitely” on its way up, so she concluded that she would keep a mental stop and that a mechanical stop was not necessary. After she got filled, the price action did venture upward for a while and she became more confident in her decision. But, then the price action hit a… Continue Reading
