"I closed too early again," "I lost profit again..."
I believe that for those who have spent time in trading, they have experienced and understood one thing... that making the decision to CLOSE an order is much more difficult than entering an order... because of human emotions, especially for those who are new to trading, when we have not set up the right psychological mindset for this job... a beginner will always be urged by the market, constantly tempted by the waves on the chart, hitting into greed, hitting into FOMO, making it impossible for us to sit still, and falling into the state of continuously entering orders, also known as overtrading... some people have messaged me saying that in a day they enter dozens of orders continuously, making trading feel like an extreme stress, but they cannot stop entering orders in front of the constantly fluctuating waves on the chart... and then... they incur losses... and then... they blow their account... surely, many have shared this empathy with this situation.
Entering an order is already difficult, but closing an order is even harder, because at that moment, whether the order is running in profit or loss, there is a psychological entanglement... if the order is losing... we feel regret, fear, and hope that it will turn back... and if the order is profitable... we get immersed in it, greedy and want the trend to continue to gain more profit. And in any case, when we let emotions participate too much, it obscures our reasoning and logical thinking from the data on the chart, causing our actions to deviate from the actual market developments.
In principle, it sounds very simple...
1. Only buy when the market has run out of selling pressure, and the buying pressure begins to appear.
2. Only sell when the market has run out of buying pressure, and the selling pressure begins to appear.
No forecasting, no judgment, no stubbornness, no emotions... everything is based on market developments... if the market still has the power to run, let it run, when the market runs out of power, I close... if the market lacks strength and goes against, then simply accept stop loss as the probability is an indispensable part of this job. In this profession, anyone who does not accept risk will find it hard to make a profit.
Listening seems quite obvious and basic, right? But to achieve this, we must have a psychological training process that requires effort and time (note: no one should think that trading is an easy job; that mindset will wear you down or even burn your account)
So why is this hard for a beginner? It is the emotional entanglement during trading as I shared above... When the order is profitable, greed and hope for profit continue to increase, at that moment, reasoning is obscured by signals showing that the trend has gradually weakened, we stubbornly cling to that hope and let go of the profit that should have belonged to us... negative emotions arise, self-blame, torment, stress... "I should have closed at that point," "if only I could do it again," "why was I so foolish to lose all the profit"... etc... And when we only observe and act based on the signals the market is showing, analyzing with reason without emotions, we will find it easier to make decisions, because there is no clinging and greed, stubbornness... Observing and acting with reason is like a green light to go, a red light to stop... but when participating in the market, beginners will find it very difficult to overlook their emotions.
And when the order is losing, the very expectation makes the loss grow larger... we fear losing money, we fear stop loss, we fear incurring losses... it makes us have unrealistic expectations that by some miracle, the market will turn back... it leads to common mistakes like: removing stop loss, DCA against the price... and what comes next, many of us have experienced.
Pointing out the issue like this, so you can see that trading is not simple at all, the hardest part is the psychological pressure and the ego of oneself... and to improve that psychological issue... it truly requires diligence, perseverance, effort, and time...
We cannot demand that we become perfect and professional immediately, just as we cannot ask a medical student to perform surgery on a patient right away... if you are the patient's relative, would you allow that? If you would not allow it... then do not force yourself - if you are a newcomer - to participate in the market and demand profits from it... But... allow yourself to be an intern, to be a person allowed to make mistakes (do not let the lessons you have to pay for the market become too costly)... the goal of an intern is experience, not money.
