How to stay disciplined and manage emotions while trading on the Binomo platform?

A strategy with a high win-to-lose ratio and a proper money management system is insufficient to trade profitably. It is necessary to have discipline to avoid deviating from the chosen plan.

What do you need to do to develop the habit of discipline? What generally distinguishes a disciplined (successful) trader from those who do not adhere to this discipline? How to control emotions in trading?

We will talk about all this in today’s blog.

Systematic and discretionary approach to trading

There are two fundamental approaches to market trading – systematic and discretionary. With a systematic approach, the trader draws up a particular set of rules for entering and exiting a trade and strictly adheres to them. For example, a trader trades using a strategy where the price of an asset crosses its moving average line. The trader must open a trade whenever the price crosses the moving average. The systematic approach is most like robotic trading and is especially recommended for new traders.

With a systematic approach, discipline is essential since it is necessary to strictly follow your own rules, even if the signal seems incorrect.

8 of the most common biases and how they affect your trading

The discretionary approach allows for more significant variability. A trader can refuse to open a transaction if he thinks the signal is incorrect. Essentially, the discretionary process adds an intuitive and sometimes emotional component to the trading system. Alexander Elder said that the right to intuition must be earned. This means that this approach is contraindicated for beginners and highly emotional people.

A disciplined trader with a discretionary approach consciously accepts the risks of making wrong decisions. Such a trader can quickly weigh the pros and cons and decide whether to follow the received signal. A disciplined person can easily control emotions in trading.

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How do you become disciplined?

Discipline must be trained. In some people, it is more developed, and in some, less so. For example, former military men can become good trader since a lot depends on discipline in the army. Former athletes can also become successful in trading. But what to do if you haven’t served in the military and don’t want to play sports?

How to manage your emotions and learn to become more professional? You can teach yourself discipline with a few simple rules.

Firstly, it is drawing up a schedule that must be strictly followed. There should be room in your schedule for trading and finding signals.

Secondly, you must train yourself to take notes (keeping trading diaries). How to keep your emotions in check? It is ideal if you can keep notes in a notebook. If not, then electronic form is also suitable. The main thing is to do them constantly. The diaries must reflect the reason for the transaction opening and the emotions that appeared simultaneously.

Thirdly, some kind of physical activity is necessary. If, as we have already said, you don’t want to play sports or it is impossible for some other reason, then you can do exercises, walk or run in the fresh air, and take short 15-minute breaks for small physical exercises during the day. If the physical form is in poor condition, it is difficult to demand discipline from the mind.

Following these simple rules will help you in your trading and can significantly increase the efficiency of your trading system.