7 Trading Tips from Trading Mindset Coach

trading mindset trading psychology trading tips Sep 23, 2023

Trading is one of the most challenging and difficult professions in the world. The markets are constantly changing and evolving, and traders need to be able to adapt and change with them. In this blog, I will provide you with 7 essential trading tips to help you gain full control of your trading from a Trading Mindset Coach's perspective.

​Being a trader means that you're exposed to challenges every single moment. What happens during your trading day has an effect not only on your profit (or lack of it) but also on how you feel and how you experience your life when you are away from your screens.

So trading is something that you can either go through or grow through – and these trading tips can help you set the right path for your growth:


1. Create your trading plan (and stick to it!)

Crafting a well-structured trading plan is the initial and critical move toward mastering your mindset.

But what exactly is a trading plan? It's essentially a detailed document that lays out your intentions, your objectives, risk management strategy, and the specific criteria you'll follow when entering and exiting trades.

Think of creating a trading plan as your inaugural step because it truly sets the stage for your trading journey.

Once you've got your plan in place, the real challenge lies in sticking to it with unwavering discipline, a challenge that experienced traders are all too familiar with.

Trading often exudes an alluring excitement that can easily distract you from your long-term goals. This is precisely where your trading plan becomes vital; it serves as a constant reminder of why you're trading and what you're aiming to achieve. To stay on course, prioritize your trading plan above all else and guard against distractions.

In essence, a trading plan is a powerful tool that helps align your personal beliefs with your trading journey. It not only outlines your goals and risk management strategy but also provides a systematic approach to decision-making, helping you avoid impulsive choices driven by your ego.

Furthermore, a trading plan shields you from making emotional decisions and provides a structured framework for evaluating your performance and identifying areas for improvement.

Remember, traders who faithfully adhere to a well-crafted trading plan significantly enhance their chances of achieving long-term success in the market. 


2. Be fully present in the current moment

So, ladies and gents, if you want to make trading a career, there is one technique that, if mastered, can solve your problems and assist you in overcoming the trading psychological challenges you are most certainly facing.

It's the ability to be fully present in the current moment.

I'm not referring to your actual presence. It's the ability to keep your thoughts in check and stay focused on the present moment. ​

It could help to imagine your mind as a kite, which you must keep managing so that it does not lose control and keeps moving how you want it to. You are the one in charge of the lines and the direction. Where are you going to let the kite – your mind – and hence your thoughts – fly?


Why is it so critical to trade with your thoughts focused on the present moment?

It's because going back in time and reliving all of the negative events you've had, such as losses, would activate your defense mechanism. Subconsciously, you'll be striving to avoid repeating your previous trading results, which will affect your new trading judgments. Even if the scenario isn't the same as it was the last time.

If your previous trades went well, you may feel invincible and willing to take on more risk than you should. Your prior experiences will develop a bias that will influence your current decision.

If, on the other hand, you are trading while looking into the future, you are placing yourself under a lot of pressure to have to make money. All of your dreams that could come true if you make money trading are on the line. Freedom, independence, travel, abundant living...

And all you have to do is make the appropriate trade decision to get there. Now is the time.

What if your next trade turns out to be a dud? Will you have to let go of your dream? Are you ever going to make it as a trader?

It may sound dramatic, but that process moves quickly, and one small bad idea often leads to another, only to explode in your face at the end. So, if you're trading and your mind is on the past or the future, don't be surprised if your emotions are activated. You are activating them!

All you should be thinking about while making a trade choice is executing your trading plan and the price action!

Because price action is what is happening right now. Not yesterday. Not tomorrow. The action is happening in these moments, and if your thoughts are elsewhere, it will show in the quality of your decisions and, as a result, your trading results.

So, if you're having trouble achieving your trading goals and can't seem to go forward, acquiring and practicing the ability to be present in the moment is an excellent place to start. Keeping your attention on what's in front of you. I guarantee that if you do this, you will notice an immediate difference in your trading. 


3. Stop Predicting the Future

So now you know, why staying in the present moment is so important.

That's why, the next tip is... to definitely stop predicting the future.

It's natural to try and predict market movements, but it's impossible to do so accurately.

Instead of wasting mental energy on trying to forecast the future, focus on analyzing current data and indicators to make informed decisions. This approach can help you make more rational choices and avoid impulsive actions driven by emotions. Remember that trading is about managing risk and making decisions based on analysis, not on what you wish would happen. By accepting the limitation of your ability to predict the future, you can become a more successful trader.


4. Monitor Your Thoughts

One of the most critical aspects of trading is paying attention to your thoughts and inner dialogue. Your thoughts influence your emotions and, in turn, impact your decision-making abilities. It is essential to challenge negative or irrational thinking patterns and replace them with positive and constructive thoughts.

When you notice ruminating thoughts creeping in, take a moment to identify their source and consider whether they align with reality.

Challenging negative thoughts with rational ones can help you maintain a clear and focused mindset.


Examples of Thoughts to Watch Out For:

 Don't say:  "I always lose money on this stock."

Instead, use this: "This stock hasn't performed well in the past, but it may perform well in the future. I will analyze the data before making a decision."


Don't say: "I lost again, I am so stupid." 

Instead, use this: "The market fluctuates, and it's impacted by various factors beyond my control. It's not my fault the setup didn't work out."


 Don't say: "If I lose this trade, I'll be ruined." 

Instead, use this: "One trade does not determine my overall success. I will learn from this experience and continue to improve."

5. Take Pause Before Executing Trades

One of the most significant mistakes traders make is executing trades impulsively. Taking a moment to pause before executing trades can help you avoid impulsive actions driven by emotions, such as fear or greed. A brief break allows you to assess your decisions more effectively and make more thoughtful choices based on analysis and strategy.

Before clicking the button to execute your trade, take a few deep breaths and ask yourself if you have taken all the necessary steps to make an informed decision. Double-check your analysis, review your trading plan, and ensure that your decision aligns with your long-term goals.

Remember: Taking a pause does not mean delaying your trades indefinitely. It merely allows you to take a step back and think critically about your decision, enhancing your chances of success.


6. Learn about Revenge Trading (and avoid it!)

As a Trading Mindset Coach, I can definitely see that revenge trading is a real problem for most traders. It is a common mindset trap that can lead to impulsive and irrational decision-making. When you experience a loss, your natural instinct may be to try to "recover" by making quick trades in an attempt to get the money back.

However, revenge trading often leads to further losses as emotions and impulsive actions cloud your judgment. To avoid revenge trading, it's essential to realize and accept that losses are not equal to being a loser. When you lose in trading it says nothing about your ability to trade. It does not make you "less" or incompetent. It is very normal to lose. In fact, you have to take losses to win in the end. And as long as the losses are small, as planned for in your plan, and you have a sound trading strategy - you should be seeing progress. 

Stick to your plan, even if it means taking a loss on a trade. Remember, trading is a marathon, not a sprint. Don't use your energy (your train capital) on pointless "runs" (revenge trading). Focus on your long-term goals and avoid getting caught up in short-term fluctuations.


7. Accept Your Unique Trading Path

Trading is a challenging journey, but a very rewarding one. And it's important to remember that everyone's path is unique. Comparing yourself to others can cause unnecessary stress and self-doubt. Embrace your own journey and focus on continuous improvement rather than trying to match others' achievements.

Focusing on your own path is really important. In a recent article, I went deeper into this topic. And as a Trading Mindset Coach, I'm not recommending trading chatrooms (at all!). Click here if you want to find out why.