Dan Passarelli, CEO - Market Taker Mentoring

Hey, Dan Passarelli here today! I want to talk about something that's important to every single one of you, EVERY trader. Let me start out by showing this chart of SPY. This is a chart, a one year chart, of the spiders, the S and P 500. And boy, we started the year pretty slow and steady and nice. And then we came into some volatility.

We had some pretty big market swings, some ups and downs. And for some traders, this might as well be a chart of their emotions, right? Have you ever felt that way: where when the market is going well, your confidence builds and you feel really great, and when you're making money, you're on top of the world. But then when you have those drawdown periods or the market goes against you or you have a big loser, it can really just suck the wind out of your sales and really get into your head and make you trade worse. Right?

Emotions are a bad thing in trading. But here's the big thing is that they're a very natural thing in trading. Every single trader has to deal with this in one way or another. And so it's our job as traders to overcome that emotion, to overcome the fear and greed, be more left brained, right? Apply more logic than emotion. Set a plan early and in advance. Know where we're going to get out of a trade before we get into a trade and set it and forget it. As long as we know what our risk is, we know what CAN happen and what we HOPE to happen. We're good with the outcomes and we can move on to the next trade; trade without emotion. And that just makes us trade better.

That's a handy little tip I hope helps think it should help everybody. We all need that little reminder now and then. This is Dan Passarelli. Trade Smart.