Though traders may not readily admit to it, it is quite common to lose money in trades due to emotions. Whether is due to losing or winning, it is easy to get swept up into your emotions. As a result, you end up placing trades in a heightened state.
Now, as you well know, you need to be clear headed when dealing with binary options. You need to be able to read the charts, derive meaning, and finally place a trade with a high level of certainty. So, if you are prone to giving into your passions, you could find yourself losing out. Here are some tips on how to handle your trading emotions:
Stick to Your Trading Plan
This is perhaps the most important piece of advice that you can receive. Now, it may seem that it is simple enough to do so. After all, it is just a matter of following instructions that you have already set for yourself. Just for a moment, imagine a scenario where you have been following this plan and have continued to experience losses. How are you going to feel then? There is a good chance that you want to tear it up and toss it out of the window.
This can be even be true when you have hit a winning streak and your plan tells you to stop trading. It is important to get yourself into the habit of always following your plan. Overcome the urge to deviate from it, even if you may feel like you are losing out on an opportunity.
Acknowledge Your Limited Control
The markets are simply beyond your influence. They are going to behave in a manner that is not always predictable. This means that from the moment that you place your trade, you will need to relinquish control over the situation. It is vital that you get yourself to understand this lack of power, however.
This isn’t the easiest task, especially when there is money involved. Nonetheless, getting into the habit of knowing when to let go is going to make it less difficult to come to terms with how the trade ended. In turn, you will also see that losing your temper or getting depressed is likely to have little effect on future trades.
Don’t Trade Unless You Are Calm
If you have just come home from work and are stressed out or agitated, now is not the time to start trading. Conversely, if you are feeling happy and are in high spirits, it is not necessarily the ideal time either. This is because you need to be calm and neutral in order to trade properly.
Your trades should not be clouded by anything – either negative or positive emotions. Instead, only sit down to trade if you are feeling at ease. Therefore, you will not have to worry about your feelings overcoming what you have planned.
Step Away After Trades
As you are only human, it is quite natural to get a high if you have won a trade or to feel sad after a loss. This is why the second a trade has expired, you need to step away from the computer. After all, there is nothing that you can do after this point.
It is best to take a short walk – even one that will last only a couple of minutes. This will help to refresh your mind and get it focused. If this is not possible, try distracting yourself with something else. Again, you only need to do so for a short period of time.
These are some of the ways that you can learn how to handle your trading emotions. Soon, they will less of a problem to contend with.