Trading Psychology is something many swing traders and traders avoid, but really shouldn’t.  The fact that many traders neglect or avoid this is the main reason they suffer or perform poorly in their swing trading or trading regardless of the market.  If you truly wish to put yourself on the path to success then it is something that must be addressed.

The term psychology here refers to managing yourself while trading.  That’s right, yourself and not your trades.  This may sound a little strange, but trading induces a wide variety of emotions and reactions in people, especially when they begin to suffer a loss or start making a profit on a trade.  Many people lose control when it comes to trading and the thought of how much money they might possibly earn clouds their judgment.

Part of trading successfully is ensuring that you follow your trading plan and stick to the rules.  Beyond this, many traders, once they have several successful and highly profitable trades under their belt, begin to assume that they can outsmart the market.  As soon as this happens they are more often than not dealt a severe blow and suffer huge losses.  The market has basically taught them a lesson.  You are NEVER smarter than the market.

Swing trading and trading in general involves a wide variety of emotions.  If you are not aware of how these emotions can affect you, you may find that you execute your trades perfectly but always seem to close them out based on emotions and not market conditions.  To trade successfully, one must fully under the psychology of trading.