It might come as a surprise but traders often go to psychiatrists for medical treatment rather than to psychologists for motivations, since their level of stress can be something a psychologist cannot fully understand.
What to do in case of panic? How to avoid another collapse? Where is the line beyond which a trader feels self-fulfilled?
Let’s see what you can do about it and how to turn a constant state of distress into a possible advantage…
Psychology of Trading
An Exness survey clearly showed that about 31% of traders feel stressed while trading, resulting in negative side effects, and there is no way to walk on the positive side of the negative!
Brett N. Steebarger in his manual “The Psychology of Trading” explains the fact:
“People who are in too much pain can’t go on, while people who are not in enough pain have no motivation to change. Mistakes are a powerful source of information that is covered with pain to remember. If you rethink your stress with this understanding, it becomes easier to understand the psychology of a trader. It also becomes clear that it has nothing to do with the classic psychologists’ attitude “calm down, breathe evenly, and stay positive”.
Trading is a psychological game where distress is inevitable.
What, then, is trading distress?
Stress is an expected quality of any organism that leads to the activation of all vital forces by releasing adrenalin. It serves — for a short time — the maximum realisation of a task. So you can increase your abilities to their full capacity ( psychological or physical). For instance, you can remember a certain math formula on your finals or escape from your neighbour’s dog.
However, if stress comes after stress, the brain is more likely to get lost in hesitations than to find practical solutions. The brain is no longer experiencing stress but distress — a dangerous condition that can harm the whole body. But if you learn how to work with stress, it will work better than caffeine.
By the way, no coffee for trading — experts say this boost drink can lead to impulsive decisions that may negatively affect effective trading.
Trading distress implies a real warrior’s way of thinking, where the control of emotions is at the level of a samurai, with the charisma of a cowboy and the strength of a superhero.
There is no question of choice here: a trader must follow this path to succeed in his business and turn “trading distress into success”.
Repair your distress
Distress is a constant tension in the body that must be released so that it does not harm it.
Therefore, the advice is simple:
- Exercise, but not excessively;
- Take a healthy diet;
- Do eye-warming exercises;
- Attend hangouts and social events without being overwhelmed;
- Make decisions effectively.
Talking about effective decisions, this can be a crucial point for traders. For example, jet pilots flying at high speeds have to make split-second decisions during flight. However, the correctness of a lightning-fast conclusion is always directly related to the pilot’s training.
Trader preparation includes both market knowledge and self-control. One without the other does not exist.
Yahoo Finance says a trader’s decisions are always “balanced between fear and greed.” And only by practising neutrality can one make a sober assessment of the situation.
That’s why traders don’t avoid stress but learn to interact with it to gain the benefits of money-flow energy while staying healthy.
During an experiment conducted with the crypto trader and Cryptorg.net founder Andrey Podolyan, where his stress curve was overlaid on the Bitcoin chart -
It turned out that the lines often coincide. The experiment continued with the treatment; Andrei adjusted his daily routine, diet, sports, and rest. He started drinking less alcohol and stopped exercising to the limit. He began to sleep better and enjoy himself more. As a result, his health indicators improved within six months, and he became faster and more efficient at work, although his income level remained the same.
There are a lot of ways to achieve the fullest equilibrium. For a trader who has taken the zen path, these three are suitable:
- Know your mission: always know what you’re going for in trading; what is your goal financially, and is your strategy justified?
- Take a break: rest should be a part of your overall discipline
- Focus on your tactics to fight the market.
But what can you do if the situation is so stressful that any kind of “zen” is out of the question?
Go to a trading psychologist.
Yes, sometimes it’s difficult to go to an ordinary psychologist with your problems from trading the market — to understand them, the psychologist has to trade. That is why the trading psychologist profession is gaining popularity. This type of specialist will understand your situation. He knows all of the brain’s reactions to the chart movements. It should not be confused with a coach. This person will primarily adjust the wheel of life balance so that it starts to turn for the better.
Trading log
If you can’t objectively call your situation critical, it’s better not to get close to it. You’re better off taking preventive measures. Keeping a trading diary is perfect for that.
In this diary, you need to record all objective data:
- The purpose of the trade, or why you need the money.
- Anticipated profit
- Stop-loss
- Take-profit
- The mental state of the day on a scale of adequacy (not to be confused with the positive and negative)
- Deals
- Emotions from each trade
Read more about how to keep your log here.
As we wrote above, trading is a psychological game. With only one “but”: the term game implies getting pleasure more from the process than from the result.
The trader chases the profit in the first place. At the same time, he is not competing with other market participants — on the contrary, he is “chasing” the coin to specific indicators simultaneously. So, the spirit of healthy competition in the atmosphere of an exciting game has been washed out of trading.
Exactly! What about competing with other players to find out who reads trends better?
There is no such way yet. However, it will soon appear in the Web3 shell.
We are speaking about Banksters — a web3 game that rewards those who predict market trends better.
Players will battle it out in Investment rounds. Each character has a different set of abilities. In this form, it is somewhat similar to the UNO card game. For example, if Cardano falls, and the player throws Elon’s tweet at it, this will drive the coin’s value to the desired top in a moment, making it the single chance to influence the market rates.
The players will be represented as NFT banksters, which allows the trader to create his Web3 personality. And this, in turn, will add more elements to the game in the “thrifty world of trading”.
You can join the waitlist now! And when it’s opened for Beta-testing, you’ll be the first to know! This can be the ‘’medicine’’ you were looking for, taking out the stress while gaining bonuses from the game.
Banksters will turn traders into players and the market into their competition ground.
Join our Social Networks and stay tuned for updates!
B.
