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Trading Psychology – Architecture Of A Winning Strategy

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Patience Ensures Logical Decisions

Isn’t it amazing how the market always seems to chase a move to the upside. I remember when ChainLink went on that massive surge last year and greedy inexperienced traders kept piling in at the top. I know there was a fair amount of safety, as the Link Marines were set on teaching the FUD shorters a serious lesson. However, at some point the steam begins to diminish and smart traders begin to average out of their positions. LINK went on to dump, leaving the greedy bag holders on the side of the road with suitcase in hand. Fortunately, the current bull market has pushed LINK to new all time highs and those who chose to wait it out are really glad that they did.

I traded LINK from the low dollar zone all the way up to the $11 mark, at which point, I called it a day. I could have continued to push on but I had made some good gains and for me, there were other trades that I was eyeing. I always do my best to front run the market, which means I enter a position significantly earlier than most. In the case of a trade, I will exit earlier than most too! You can never really make significant returns chasing a move and it is far better to solidify a position prior to the parabola. In the case of a hodl position, I enter early and then sit it out indefinitely. If the project happens to be a staking or mining coin, then I have created a passive earning machine.

What many people fail to remember, is that the market is not just numbers and charts but rather numbers and charts reflecting the behaviour of people. People are at best compulsive, irrational, greedy and fearful when dealing with money and investing. Once you begin to apply human behaviour to your interpretation, you begin to see more clearly and gain an advantaged perspective. In all my years of running traditional businesses, the number one skill I developed over time was emotional intelligence. Knowing how a particular staff member is going to respond under certain conditions allows you to predict the outcome and plan accordingly. Psychology is always a great investment, as you will use it in whatever career path you chose to follow.

Planning For Every Possible Scenario As Best As Possible

No matter how much conviction you think you may have regarding a particular position, you have to take the worst case scenario into consideration. If you are going to be part of the 10% who consistently make money trading, you are going to need to have much more than a conviction. I paid my school fees some time ago and have been trading for approximately 14 years or so. I tried every known strategy and had some victories but my trading only began to become consistently successful once I developed my own strategy. This took quite a bit of trial and effort and was developed trading forex. I fine tuned it with Crypto and now trade Crypto exclusively.

The law of averages, relativity and taking into account every possible scenario are what form the foundation of my trading strategy. It is designed to have a reactionary response and execution when things don’t go as intended and adjusts my average accordingly. I guess there are many strategies one can use but to be honest, until you sit down and develop your own strategy and style you are likely to feel uncomfortable trading, not to mention nervous.

You should not even seek to imitate any trader, rather let an article like this merely point you in the direction of personalising your own strategy and approach to trading. Your successes will also become a lot more rewarding and supersede the gains of past. For some this will be more meaningful than others. Those who value independence and enjoy going their own way will derive great satisfaction from developing their own winning strategy.

If you have developed your own winning strategy, you will understand what I am communicating. Thanks for stopping by and all the best for your trades in these exciting times! Please remember that this is not financial advice and I am not a financial advisor. These are my experiences in the Crypto space and should be consumed as entertainment.

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Elikem Codda

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