Psycology of Intraday Trader

Psychology plays a great role in day trading. Everyone wants to buy at low and sell at high and to capture the upward or the downward moment fully to get the maximum profit. But only two types of persons can execute the trade properly, one is GOD and the other is the liar. It is really impossible for anyone pick a stock at bottom and sell at top. However, most of the traders fails and blame their psychology.

Another one scenario is stop loss management, while providing stop loss, most of the time after hitting the stop loss the stocks move on the right direction. Mentioned points makes mad any trader specially on the initial days. Stop loss management is a different topic. However, I am explaining the psychology of a trader in this topic.

Let’s take an example of a hunter who is having a sniper in his hand and trying to shoot an object. Now to be successful hunter, he has to practice a lot and has to be knowledgeable enough to handle a sniper. If he is not so, he will eventually fail to become a successful one. So, the first and for most important aspect of hunting is skill.

Similarly, any intraday trader has to be very skilful about his techniques. He has to understand the technicalities of the trading system and skilful enough to handle it.

Now the second aspect of a hunter is his risk to reward, I mean what he is gaining out of his investment and what he is losing. Suppose a hunter is hunting a rabbit with a sniper, do you think it is worth? the price of a sniper bullet is higher than a Rabbit.

A trader needs to trade on the valuable and gainful trades only, not on every move where he has to give more price then to become a successful one, here I mean that the stop loss price and the brokerage.

Even if you are able to understand the value of a particular trade and skilful, still you can be in loss making zone unless you have the "Third quality”. The third and most valuable aspect is patience. Every sniper holder has to hold the sniper tightly and patiently for hours to become a successful one. triggering a sniper is just a 2 second job but waiting for the right moment to trigger is the most valuable aspect. You also need to wait patiently for the right price movement with your full concentration otherwise you can miss it. Remember that clicking a buy or sell button is just a two seconds job, but waiting for the right movement is the key to success.

If you have the patience, if you are skilful and if you understand the technicalities/market psychology of any trade, you will eventually become successful.

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Happy Trading.......

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AnonymousMarch 5, 2022 at 2:13 AM
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