Critical Inner Voice? It’s Worse Than Useless30 May 2022
If something happened … We all know this. But we don’t apply it.1 June 2022
If you bought Bitcoin a year ago, you would have spent the next few months feeling pretty smart.
If you didn’t take profit, or didn’t exit when critical trend lines broke, you are most likely not feeling too smart now. There is no right or wrong on the profit taking question, or the price action exits. Your strategy may well be ‘stay in whatever happens’. But it’s easy to under-estimate how painful losses will be – until we experience them.
Many will respond to losses by soul-searching and wondering why they did what they did. The decision you made last year is the same decision that once had you feeling on top of the world.
Now things are different.
The decision is the same; your perception of it has changed.
You are learning about risk.
If you decided to commit to crypto come what may, that is also the same decision. It was once a profitable decision, but now it isn’t.
Trying to figure out why you did what you did – so that you can be sure you don’t do it again – doesn’t work. It’s a red herring. It looks right, but it’s making things worse.
I spent over eight years doing this and met many traders who were trying to deal with losses in this way.
So what should you do instead?
Skill wise, you need to understand risk and learn how to develop a trading strategy. You can get inspiration from other traders, but you must design and test your own rules. Your rules could be a simple as, ‘I draw my daily chart trend lines, and if it breaks, I do x, y and then z.’
Emotionally, you must clear the impact of the losses. You also need to clear the effect of easy profits, as these memories lead to recklessness.
I am not being subtle here, because I know from experience how absolutely essential this is. If you don’t, you will lose more and your pain will increase. How you do it is up to you.
If you’re feeling fine about your losses, then by all means continue. Good luck to you. But if you are far from OK – not sleeping, low mood, being secretive, preoccupied – then please do get in touch by DM.
After many years searching for coaching that actually worked, I discovered Rapid Resolution Therapy (The Institute for Rapid Resolution Therapy, Inc.). It is far and away the most effective way to clear the emotional impact of financial gains and losses. I have taken Van Tharp’s courses, and many others, but for this, RRT wins hands down.