Introduction

Welcome to the second week of blurttradinghub. In this week we will be talking about the psychological aspects of trading. The success a trader makes in the financial market, despite how much he/she knows the market, trading system and trading techniques depends on his/her psychological state of mind.
This course aims at getting the students familiar with the emotional conditions they may face while trading and how to handle these emotions without letting it get to them.
This course has been divided into two parts to avoid making it ambiguous.

Definition Of Psychology, Trading and Trading Psychology

Psychology:

Psychology simply put can be defined to be the state of well being of the human mind, that is a person's mental health. This refers to the person's personal emotions, feelings and thoughts, how he/she can always be productive despite challenges faced.

Trading:

Trading can be defined as making investments in securities and crypto currencies while observing it's price movement. It is also the buying and selling of securities and crypto assets in order to make profits.

Trading Psychology:

There are certain factors which dictate the failure and success of a trader in the financial market and trading psychology is one of them and likely one of the most critical factor. Trading psychology can be defined to be a trader's mindset and the emotional conditions while trading. A traders psychology plays a major role while he is active in the financial markets, just as every other trading attributes do.

Understanding Trading Psychology

It is possible for every trader in the market to have the similar thoughts or go through similar emotions while trading. But there is always a difference between the psychology of trader who is making losses a trader who is making profits. It is absolutely wrong for a person to think that all he needs to be a successful trader is a reliable market which has been explored and tested. Some traders invest more of their time and resources into creating or setting strategies which will help them to perform well in the market and succeed. However in most cases some do not still succeed, because they pay less attention to an important factor which has the capacity to make them fail. They do not take time into finding out how to handle some psychology barriers; emotional extremes. A trader's emotion is one factor which can hinder him/her from thinking straight and making proper decisions.

Most newbies in trading who venture into the financial markets and end up failing is sometimes because of their inability to keep a good trading psychology and control their emotions. Some traders start by keeping an unrealistic mindset during trading, they set imaginations too high and this affects their thinkingband analysis therefore affecting their success as well. A person who wants to start trading should beware that the financial market is not a money doubler, some think they'll quit their job just a few months after they start, or plan to invest a thousand Euros and expect it to yield hundred thousand a few months after. Note that having such thoughts will only result to nothing but severe losses.

Nuturing such thoughts is bad, because they're completely incorrect expectations and they'll force a trader believe he can make profits in the financial market by any means possible. The more his/her expectations rises, the more he/she becomes vulnerable to be controlled by his/her emotions and trust me one thing a trader wouldn't like is being controlled by his/her emotions. These unrealistic expectations and uncontrollable hunger for profits contributes to what makes a trader quit the financial market sooner than planned, because he/she is likely to go extremely broke.

Emotions in trading

A traders emotions can be a major loop-hole or enemy to his/her progress. Learning to control your emotions while trading so that they do not make any negetive impacts on your success does not come easy, however with good mastery skills and some months of practice it can learnt. One of the targets a trader should have is killing his/her emotions while trading. These emotions are;
• Greed
• Euphoria
• Fear
• Revenge
• Pride
• Anger
• Happiness

The above listed are the common emotions which could take over a trader, therefore you ought to do your best to overcome them and while trading. Try as much as you can to maintain a clean and stable mindset while trading, so as not to suffer severe losses.

Managing Your Emotions While Trading

There are ways which can help a trader properly manage his emotions while trading. However it is not something that'll be achieved at once.

1.) Proper Research

Getting yourself equipped with sufficient information and update on how trading and the financial market in general works will go a long way in helping a trader improve his/her psychology. Making research will help trader know how to handle certain market conditions or movements, while still maintaining a calm mind, he/she will be able to take smarter decisions towards certain changes in the market.

2.) Stay focused

Staying focused while trading is not quite easy, because there are a lot of things which could possibly distract a trader. Some new investment opportunity, which will look to yield much more profits is one of these distractions. So build your mind to always stay focused on your target.

3.) Quit Being Greedy

Bullish movements in the market may get a trader to become greedy. Don't be a "Pig". Pigs are those investors who do not make proper analysing, yet makes heavy investments because their plan is to make the large amounts of profits within very short time intervals and they end up suffering severe losses.

4.) Control Your Fear

It is very essential for a trader to control his/her fear, rather than his fear controlling him. While trading, fear is often triggered by bear movements in the market, some traders tend to panic, because they want stop losses and exit the market as soon as possible and this makes them talk irrational actions which may not turn out well. A trader should build a trading plan which will help him handle such situations comfortably, and still maintain a good trading psychology.

Conclusion

The need for a trader to Learn how to handle his/her emotions while trading cannot be over emphasized. In order to be successful in the financial market it is necessary that a trader maintains a good trading psychology which cannot be influenced by any sort of emotional extremes or imaginations/thoughts. I urge everyone to do the best he/she can to build a good trading psychology in order to avoid going through much losses. The part 2 of this course will be taken next and we all will learn more about trading psychology.

Homework Task

1. Explain what you understand by trading psychology.
2. Explain any 3 out of the above listed emotions which occur in trading.
3. Explain How you plan to Build a good trading psychology.
4. Develop a simple Trading goal and how you plan to achieve it.
5. Conclusion

Rules For participation

1. #blurttradinghub should be your first tag for easy recognization followed by your country tag e.g #blurtnigeria.
2. Use #s1w2venom-21 as your third tag, so that I can easily locate the homework Posts
   E.g #blurttradinghub #blurtnigeria #s1w2venom-21
3. Introductory post is compulsory.
4. A minimum of 100 blurt power is required
5. Reblurt compulsory
6. Each account is allowed to enter once per week in Each of the levels
7. No plagiarism of any kind is allowed
8. All materials/images from the web should be properly sourced
9. All entry to this course closes by Saturday 11:59 pm UTC.
10. Your homework Post should not be less than 250 words.