Fear and Greed, the Trader's Nemesis

Fear and Greed

The most important aspect of successful trading is to overcome the psychology involved. Trading is 85% mental and 15 method. Fear and Greed are always emotions to overcome, which if not controlled, will interfere with success.

Fear

Types of fear traders experience:
Fear of losing
Fear of taking a trade
Fear of not taking enough trades and missing out
Fear of being wrong in trading decision
Fear of having to make a decision
Fear cannot control the market
cannot control themselves.

Fear reduces ability to focus on objectivity.
sweaty palm and rapid heartbeat doesn't help the process of trading. These fears will sabotage the trading decision and execution process, resuting in undesirable outcomes such as missing a trade altogether, entering the trade late etc.
How to overcome this fear? Need to develop confidence and through practice. The important tools are to know oneself and develop an effective trading plan.

Greed

This is the other evil emtion of trading What happens to a trader is that the exits after entering trade, are based on greed-there is an urge of wanting to max out profit for every trade. Have to have mindset of being consistently profitable ie take the profits when they are there. Nobody however good can sell the top or buy the bottom of every move. Profitability will come from consistency in following trade plan keep emotions under control. Trading is a business, not Las Vegas or a roulette wheel.