Copyright (c) 2009 Gecko Software, Inc., All Rights Reserved. Lan H. Turner President, CEO Gecko Software Editor In Chief PitNews Magazine As an 18 year trading veteran, I’ve seen a lot of traders come and go. The successful traders are the one’s who take the time to learn the skills necessary to become successful at this business, and they are the traders who are still here working with us today. Never stop learning, stay in touch with the markets, as well as other traders; you must keep your head in the game to succeed. Lan H. Turner RESOURCES: Fibonacci Software  -  Elliott Wave Software  -  Futures News  -  Best Trading System  -  Forex Trading Software Futures Trading Software - Learn To Trade Commodities  -  How To Trade Futures Forex The Best Stocks, Futures & Forex LIVE Trading Software On The Market Today! Pilots are not only skillful in their ability to competently take off, fly and land massive pieces of machinery, but they also have a considerable amount of psychological pressure with the need for a high level of emotional control. To take hundreds of people’s lives into their hands, both within the plane and those below, takes guts and confidence within their own ability and the plane itself. Emotional control makes a massive contribution to the success of a trader. The secret to trading is not in a particular secret plan or set of strategies that you need to uncover, instead it is the ability to always remain emotionally in control; detaching from any external influences that will be tempting you to take actions which are outside of your Trading Plan rules. Emotional control makes a massive contribution to the success of a trader. A pilot will be faced with many different external conditions; high winds, rain, fog, clouds, birds and even other aircraft. These sometimes arrive with no warning. Traders experience the very same onset of conditions, and the point I am trying to make is; it is their reaction to these conditions that determines their level of continued success. The financial markets are based upon emotion and are the pure reflection of each individual market participant’s perception, and therefore reaction to what they see and hear. It also goes much deeper than their perception to events. A traders success can also be affected by their ‘money habits’; these habits are acquired through the conditioning of their childhood. If the child is brought up in an environment where the household spends what they earn, especially on unnecessary items (they acquired little or no assets); or spends more than they earn (large household debt), then this person will most certainly have the same money handling skills into their adult life. Unless they make a conscious decision to gain better money skills, because regardless of how much they make, it will dissipate the same way. You know, when I first heard the concept of ‘Trading Psychology’ and how significant it was to being successful in the markets, I first thought to myself ...“well I have good emotional level headed and don’t get flustered too easily”. It was until much further down the track did I realize that this wasn’t enough – it went so much deeper than that. My money habits, my money handling skills were really bad. Anytime money came into my hands I had to spend it. With the financial markets being highly liquid I could access my cash almost immediately, and spend I did. It is really hard to see what our habits are until we make the conscious decision to ‘see’ them. Otherwise we are simply operating from a preconditioned state – our habitual state. And all this seems very ‘normal’ to us, and often we think it is how everyone else functions too. If you want to know how you ‘think around money’ look at what your current results in your life are. It is really hard to see what our habits are until we make the conscious decision to ‘see’ them. What sort of annual income are you on? Do you have many or any Assets? What is your Net Worth? - add up your Assets and then deduct all of your Liabilities to find out your Net Worth. Are you forever chasing your tail with bills? Are you Asset rich but Cash poor? The answers and reflection upon these questions will allow you valuable insight into what your thinking has been up, until this point, around money – do you respect money? The good thing is that you can change it. Some people have had the right upbringing in so far that they received the right money handling skills and emotional control that allows money to flow into their lives and is retained within the right forms. Their money is spent mostly on appreciable assets than depreciable assets. If this is their ‘normal’, these people do find it hard to ‘see’ how emotional control could be one of the most important things to obtain and therefore succeed in trading. They already have it. It is only when we need to change our habits, do we realize how hard they can be to change. Emotional control spans across the traders’ ability to research the necessary skills and strategies required to create and retain wealth – not just being able to enter and exit the market in a timely manner. Profits need to be handled and reinvested correctly. Our emotional control also stems from our childhood conditioning. Most of our reactions to external events were copied and learned off of our parents; the way we react to conflict, to busy traffic jams, to unforeseen events, to losing money, to making large sums of money. Do you get anxious when faced with adversity, or over elated when faced with euphoric situations? Trading the financial markets entails emotional ups and downs like a flight on a stunt plane– looped de loops, quick turns, high and low altitudes, followed by steep dives. Watching profits come and then go can make any person feel sick to their stomach, and if you haven’t been following, or have confidence within, your trading plan, then these feelings will be intensified and can swing from one emotion to another very quickly and without warning. Trading the financial markets entails emotional ups and downs like a flight on a stunt plane Our emotions stem from our perception of external events. Most people live at the mercy of their emotions – when they see or hear something they automatically react from a habitual state rather than with actions that are the most advantageous for themselves and any other party concerned. Their decisions are based emotionally rather than logically or upon a system. Systems, when followed religiously, can give fairly predictable results. But if the trader deviates from the systems variables the prediction of the outcomes becomes obsolete. If a person is unaware that they are reacting emotionally, rather than an approach that is non- emotional and mechanical with every part of their system followed step-by-step, they will be wondering why they are not finding consistent success. The emotions that drive the market are fear, greed, ego and hope. Traders will be experiencing one or more of these simultaneously or at rapidly changing time frames. It is ok to feel these emotions, what is not ok is reacting to them in ways that are outside of your trading plan guidelines. If your trading plan tells you to close out your entire position, even though you have just made a massive profit your ego is most likely enticing you to hang in there longer to make more profits. Not only that, but this ego is also fantasizing about the new convertible it can see itself in. “Just a little longer in this trade and I can afford a deposit on that new luxury car”. The weakness displayed in the market, which was why your system was giving sell signals, suddenly becomes very apparent as the market plummets and goes against you, eating up all profits. Feelings of anxiety and fear replace those happy feelings of elation. If you continue to hang on to the position hoping it will go back up, you have moved through another of the emotional states again. It is amazing how well our mind and emotions can trick us into thinking that ‘this time it is different’. And often becomes much worse when the outcome is fruitful by chance. This causes the trader to experience delusions of their ability, thinking that they either have a ‘natural’ ability or ‘intuition’ around the market – but sooner or later will become a slap in the face. I believe that intuition for the markets movement is created when the trader has taken the time to research, study and practice their system over various market conditions so that it has become internalized. Regardless of our background conditioning anyone can become successful, you just need to have the passion, desire and drive to succeed. If you have a good understanding and vision of what the Forex market can offer, then you will do what it takes – the lifestyle it can bring is certainly worth it. Don’t try to take short cuts in your learning either – as you will need to eventually go back over what you missed and will invariably lengthen the total learning process. This is enhanced by our psychological makeup whether we naturally try to ‘skip’ over new material or sometimes we assume that we ‘know it already’. However, I believe we don’t really know something at a deep level until we are successful at it There are a number of courses and free information available on the subject of trading.  One such highly recommended source is Dr. Scott Brown, found on the web at: www.TradeMentors.com.  Other fantastic resources can be found on our Resources Page.