A reader recently posed a question about getting past the mental barrier of not being able to actually place a trade. Paraphrased, the issue is something like this....the trade signal has been given (via a chart system or some from of fundamental analysis), entry and exit prices have been set, and all that's left to do is make the phone call to your broker, or hit "enter" on your computer keyboard. But at this point, all the doubt and second-guessing comes to a head, and the trade never gets placed. Sound familiar? It's probably the most common heartache faced by traders, and is only compounded when it turns out that it would have been a great trade. This is a tough issue, and unfortunately there is no magical answer. However, we do have some tools that will help you work past the problem.
OK, we're assuming that you do indeed have a proven system and found a trading opportunity that fits your criteria. Great. The next step is to actually place the trade. As all of you know, this is much easier said than done. Suddenly you become very good at second guessing, and you find a few dozen reasons not to enter the trade after all.
Do any of these words ring a bell with you? (I bet they all do).
These are tough things to deal with. Uncertainty and regret are powerful emotions that can weaken even the best of traders. The things you have to remember are as follows:
The next time you think or say these phrases that might convince you to not enter a trade, I encourage you to actually respond to yourself as specifically as possible, like this:
Pulling the trigger may be the toughest thing to do, but it's also the whole point of trading. It's better to take action, succeed, fail, and learn, than it is to sit back and let the market pass you by.
Price Headley is the founder and chief analyst of BigTrends.com.