There are a few things all traders need to learn - and they generally aren't what most of the trading education out there teaches.

#1 Trading is not solving an algebra problem. No matter how how you try, you will not find the magic indicator that will solve for X and make you money.

Unfortunately for the vast majority of traders however there is the human desire for certainty so many keep searching. A better strategy is to figure out whichever sport or hobby you relate to and think of your decision making as if you were either playing that sport, writing that novel, painting that painting or building that boat.

There are bunches of corollaries to this idea ... like stops and targets, if absolute and immutable, will never make you real money... but that discussion must be left to another venue.

#2 Emotions do not need to be controlled, actions do.

Everyone puts all of the emphasis on the emotion when in reality the thing you can control is how you act out the emotion - not the feeling itself. In fact, if you have no confidence, will you take the trade? Is confidence an emotion?

Feeling frustrated or angry, afraid or disgusted isn't fun (I know that!) ... but it is still only a feeling. Trying hard to rid yourself of the feeling only loses you the opportunity to learn what it is telling you and sends you down a path where you will act out the feeling anyway - usually in what will later look like a very stupid trade!

Visit Trader Psyches to register for Denise’s blog updates.