Perhaps the most difficult act of every trader is not to operate in the markets, but to maintain total control over your emotional state when operating. Trading cryptocurrency can be a grueling affair, with many traders seeking overnight riches. However, it is important to remember that this is not likely and you must control his emotions while trading. Have a commercial strategy prepared in advance, where the financial asset that you are going to operate has been defined, the behavior of its price, its volume, the direction and strength of its trend, and above all the time, the temporality in which you are going to operate they can help cryptocurrency traders achieve success with the least amount of hiccups. It's easy to get caught up in the potential to make money, but when losses occur, it can be overwhelming if your emotions take over.
Emotions: psychophysiological reactions that represent modes of adaptation of the individual when perceiving an important object, person, place, event or memory. Psychologically, emotions alter attention, uprank certain response-guiding behaviors of the individual, and activate relevant associative networks in memory. Feelings are the result of emotions, they are more lasting in time and can be verbalized (words). Physiologically, emotions rapidly organize the responses of different biological systems, including facial expressions, muscles, voice, ANS activity, and endocrine system activity, and may aim to establish an optimal internal environment for the most effective behavior. Taken from: https://en.wikipedia.org
The most profitable crypto asset traders are those who have mastered their general trading skills, including controlling their emotions when trading. A business plan that includes diversification and cost-in-money averaging can help make a crucial difference in your success. Knowing when to make a profit or get out of losing trades is one of the points that your strategy should never lack, in fact it should be the fundamental point of any strategy, there are many occasions when we have winning trades and out of euphoria (or ambition) we let "run" and end up either losing, or not winning what was expected, or we don't cut losses on time, situations like these will only cause you to lose control of your emotional state.
The psychology of trading crypto assets is one of the most important components for both novice and more experienced traders to enter the trading scene. It is vital to explore the importance of controlling emotions and exercising discipline in situations when it comes to trading cryptocurrencies. It is important to go beyond emotions and learn about the different components of trading psychology. The need for traders and investors to manage their emotions is especially important in situations where money is at stake, as it can lead to a feeling of helplessness when one is losing money. To prevent this from happening, it is important to create and stick to your own business plans and rules. Viewed from this perspective, the losses that come with trading are part of the process of learning and striving for excellence.
SOME POSITIVE EMOTIONS THAT THE CRYPTOM TRADER FEELS:
- Hope (It is negative if it has no real foundation, the markets do not move by Faith)
- Euphoria (Be careful, it is very easy to go from euphoria to depression with a single market movement, be disciplined with your strategy, take profits on time)
To deal with negative emotions when trading, traders should avoid revenge trades or attempts to make a little more profit. These only lead to worse trades and higher losses, creating a cycle of pain and disappointment. Rather than letting emotions control trading decisions, traders should focus on creating a positive emotional state that follows after a successful trade or dairy (a trade designed to minimize losses).
SOME NEGATIVE EMOTIONS THAT THE CRYPTOM TRADER FEELS:
NOTE: in my personal trading strategy I avoid these negative emotions by trading with calculated risk, the STOP LOSS is my "secret weapon" against these types of emotions and I let the market do what it invariably always does: WHAT IT WANTS , or I take profit where I speculate the price will arrive or the stop loss cuts my losses)
To do this, traders need to create an obvious trading plan that they can follow. This trading plan should be based on an understanding of the financial markets and your own abilities as a trader. Learn to acknowledge your own emotions instead of allowing them to take control, this is without a doubt the first step to trading successfully. It is very common to see how traders make emotional decisions when volatility affects their operations and leads them to make emotional decisions instead of continuing to operate with the rational thought of the previously outlined strategy, BE DISCIPLINED, do not violate your own trading plan, the Emotions are only there to put you in the way, don't let them become your own enemy. To prevent this from happening, traders should develop a trading plan before entering any trade and follow it rigorously. This plan should include gathering market research and determining entry/exit points for each trade, as well as risk management strategies. The goal is to attack emotions by thinking instead of letting whims and instincts guide trading. GOOD PROFIT FOR ALL.
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