Jackie couldn’t believe what was happening. Actually, the trade began on a positive note…so she thought. She had seen what she thought 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 wasn’t 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 supply zone that had not been identified or anticipated and it began to drop. In fact, the plummet of the price happened so fast that she felt herself become quite confused as to what to do. She began to panic as the tick dropped straight down leaving her stomach in knots along with feeling fragmented, frustrated and frazzled. Furthermore, her heart began to race and she felt tension throughout her body. She tried to manage the trade by determining where to put in a stop order to liquidate the position, but she found herself frozen with the fear of losing so much money; but additionally she also loathed the thought of staying in as she was gripped by another fear of being really stupid. Her brain was caught in a deluge of stress related brain/body chemicals that distorted her judgment and distracted her thinking.
Stress is a natural part of living; but when you are caught in a highly stressful situation your brain begins to release a number of neurotransmitters, hormones, peptides and other chemicals that can hold you hostage in that moment. Neurotransmitters are messenger molecules that pass information to other nerve cells and parts of the body in order to coordinate a specific function. Some of them are dopamine, serotonin, and melatonin. There is a whole family of neurotransmitters. When Jackie noticed… Continue Reading
