Overcoming Fear : An exercise
Many times Traders become fearful to the point where they won't take an indicated trade or they won't get out of a trade and kind of go into shock and fear of the loss. A trader might also fear inability to take a loss resulting in being stuck in a trade.
Try this:
1) Simulate taking any trade at random.
2) Once in it quickly work out how it should be managed, what stop to take and what target(s) to take profits at.
3) Only exit the trade at those points. Notice what profits or losses have been made in simulator.
Then:
1) Take a 1 dollar bill and pretend to throw it away. Do the same with denominations up to $100 bills. Now retrieve them and put them back in your wallet or purse.
Then:
1) Count the money you have in your immediate possession. Then put it away.
Then:
1) Decide the next thing you want to buy. Decide to buy it. Notice how you feel after you buy it.
2) Decide to buy something and don't.
3) Decide to buy something, then decide to buy something else instead. Buy it.
4) Look around and notice something you would like to get rid of and decide to sell it or throw it out. Do so.
Then: (repeat)
1) Simulate taking any trade at random.
2) Once in it quickly work out how it should be managed, what stop to take and what target(s) to take profits at.
3) Only exit the trade at those points. Notice what profits or losses have been made in simulator.
