How to Master Trading Psychology

Neither a book nor the tips work in terms of trading psychology because it comes from experiences or taking a live trade in the market, and today in this article, I will be sharing some tips to master trading psychology.

Here are some tips to improve trading psychology,

Don't Focus on Profit but Focus on the Process

Sooner or later, you will be able to a lot of make money, but preserving the capital is very important. If you focus on the profit, you can't concentrate on the process, so it's better to learn first because the market will always be there. And when you realise this thing, then you don't have money to trade in the market.

Do not see P&L statements while trading

Even professional traders admitted that they don't see the profit & loss statement while taking a trade. It is so true because I'm writing from my experience. Seeing P&L can destroy your psychology. And if you do not see your P&L statemen t while trading, it may help you to hold your position for longer.

Trade-in Out of the Money Option but not in Deep OTM

For intraday, I always go with the OTM option because it's less volatile compared to the ATM & ITM option because it has time value, extrinsic value and all those stuff, but the OTM option has disadvantages,

• It goes up very slowly, but when it goes down, it will very fast. And the cheap option can be very expansive if you do not put a proper stop loss.
• Not for scalping trade but a viable option for a bigger target because you can hold the position for longer.
• Deep ITM options are viable for the scalping trade.

Trade with Small Quantity

If you are a beginner, small quantity sizing is a viable option because it helps us to control our emotions and whatever we say psychologically. Do not take large quantities, which you cannot afford to lose, because trading is all about probability and risk-to-reward ratio.

• Do not take large position sizing, and these things to consider before taking any trade,
• Take a small profit because it will help you to explore the market. After you get comfortable with your setup, you can gradually increase your position sizing.

I haven't talked about LOT & other stuff because it depends upon which market you choose for trading.

Take a Live Trade in the Market

The most effective way to improve your psychology is taking a live trade in the market. And it's not going to happen in a day or week, because it comes from over the time of period.

I'm very familiar with this one because now I have more control over my emotions. It is very effective.