Avoid Emotional Involvement At All Costs

Don't do this

Emotions run high in trading. One of the consequences of emotions in trading is something I call “cheerleading.” This is when you become emotionally attached to a trade or position and actively watch it, hoping for it to work out.

You see this a lot with Bitcoin holders, but it happens to every time of trader, on every asset and timeframe.

Once you involve emotions, whether happy or sad, you’re in trouble. The point of trading is to exploit an edge with perfect discipline. You must approach it like a professional if you want the best results.

You don’t see pilots jumping with joy after they land a plane. They simply perform their job and complete given tasks. They operate professionally, and this is why planes run smoothly and airports aren’t full of accidents.

You must do the same - be completely detached from all of your positions. Don’t spend so much time checking your position over and over. You know it’s wrong to do, deep down. It’s a waste of time and a distraction.

You should do all the heavy work before you enter the trade, during your analysis. Constantly checking the price is a sign that you’re not confident in your analysis and should not be taking the trade until you are.

Let's say you have a friend who bought a certain amount of Bitcoin five years ago and hasn't looked at it once, and you bought the same amount at the same time. You'd both have the same amount today. What use did all those hours of cheerleading have when you have the EXACT same return as someone who did nothing?

This is why it's never a good idea to cheerlead. Cheerleaders tend to view the market like a sports game, where their "side" is winning or losing. This is the wrong way to look at it. You aren't tied to any single position; you must be dynamic and responsive at all times. There's no reason to keep a position if it's losing you money.  

- Tradewriter

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