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"Patience Is A Virtue"

In trading, timing is everything. Winning traders are patient. They know how to control their impulses so as to act decisively on our trading signals.

Rather than acting on a whim, they carefully follow the trading signals mentioned in our newsletters, in which precise entry and exit strategies are specified, and strictly follow it. Discipline is the key to successful trading. Although discipline can be learned, some people are more disciplined and self-controlled than others. It is useful to determine where you stand on this trait, and if you're impulsive, developing psychological strategies to compensate for it will allow you to trade profitably.

Research studies have demonstrated that some people have difficulty delaying gratification. In the jargon of behavioral economics, they "discount delayed rewards." That is, they would rather take a small profit now, instead of waiting for a larger profit later.

Depending upon whether you are a day trader, swing trader or longer term trend trader, discounting a delayed reward can be a problem. For a long-term investor, for example, it is necessary to buy-and-hold long enough for one's long term strategy to play out. There may be minor fluctuations during the waiting period, but seasoned investors have learned to wait it out.

Most novice investors, in contrast, impulsively sell as the masses panic and buy the stock back at a top, which usually results in a losing trade. If you are a long-term investor, it is necessary to be able to control your impulse and strictly follow our BUY/SELL trading signals so as to allow the price to rise over time.

Even shorter-term traders, such as a swing trader, must fight the urge to sell early. Although trades are held for much shorter windows, a swing trader must know how to wait patiently for the optimal time to sell. Selling a winner too early is not going to allow one's account balance to increase exponentially at an ideal rate.

The day trader is at the opposite end of the spectrum. Most day traders feel an overpowering need to take a quick profit as soon as they can get it. To some extent, it may be wise for a person who has trouble patiently waiting for the price of an investment instrument to increase to become a day trader. It is useful to take other steps to work around one's inclination to sell prematurely. Follow the levels we provide in our day trading newsletter to enter and or exit a trade.

It has often been said that looking at one's screen during the trading day is like sitting in front of a slot machine and trying to resist gambling. It's hard. Just as the one armed bandit tempts recreational gamblers, the constant stream of quotes on a computer screen tempt seasoned and novice traders alike to make hasty trading decisions.

It is also useful to objectify the trade. The more you can learn to view the trade objectively, as if you just don't care what happens, the more you'll be able to resist the temptation to close out a trade prematurely. A cold, rational approach to trading, along with our range of profitable trading newsletters, is the best defense against impulsive trading decisions.

Article from 123WealthQuest.com

123WealthQuest.com is a provider of leading edge advice on investing in the American market with a comprehensive range of services to suit every serious investor. For more articles on Stock Market, subscribe to the FREE Weekly Wealth Letter by clicking here or by going to http://www.123WealthQuest.com/wq/freesignup.jsp

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