What determines the skills of a good trader is the reaction to a given

loss.

Nobody likes losing money, and when that happens, it always has an
impact on anyone’s mood.

A good trader needs to understand that this risk is part of the

business, and accepting it makes you on the right path to avoid
spontaneous reactions which are mainly driven by uncontrolled
emotions.

It happens the same when an excellent trading opportunity is

missed. Even in this case, it’s critical not to surrender to your
emotions. Your compulsive ego wants you to chase pumps in a
compensatory effort, and that may be more counterproductive than
anything.
Emotional control is critical, without it even the best technical
analyst will be lost.
Another linked problem is about the risk perception. A good trader
doesn’t rely on the result of his last trade to evaluate his overall
trading ability.
The same whole scenario inherently has the same risk. Don’t let a
losing streak of trades change your perception about the situation
without an objective evaluation.

The market doesn’t care about your feelings. If you’re following your
risk management rules and your technical assessments aren’t being
invalidated, keep trading the market according to your set strategy.

Mark Douglas developed a well-developed concept known as ”the

uncertain principle.”

It is not possible to predict the future with absolute accuracy.

Anything can happen anytime. Given that, as traders, we have to
consider the probabilities for a given setup to strike in and adjust
our mindset considering it.
A trader needs to be in harmony with the market. Many traders end
up to challenge the market,

getting burned inevitably. Ultimately it’s better to adapt to the trend

rather than try to fit the market to your current mood or random
idea.

Here are some of the quotes that I like the most from the book:

“I haven’t seen much correlation between good trading and

intelligence. Some outstanding traders are quite intelligent,
but a few aren’t. Many outstanding, intelligent people are
horrible traders. Average intelligence is enough. Beyond that,
emotional makeup is more important.”

“Ninety-five percent of the trading errors you are likely to

make — causing the money to just evaporate before your eyes
— will stem from your attitudes about being wrong, losing
money, missing out, and leaving money on the table. What I
call the four primary trading fears.”
“Why do you think unsuccessful traders are obsessed with
market analysis? They crave the sense of certainty that
analysis appears to give them. Although few would admit it,
the truth is that the typical trader wants to be right on every
single trade. He is desperately trying to create certainty where
it just doesn’t exist.”

Moreover, finally here are five quotes from Mark Douglas’s book
which should be marked permanently on your skin, as a trader:

Five fundamental truths:

1. Anything can happen.

2. You don’t need to know what is going to happen next in

order to make money.
3. There is a random distribution between wins and losses for
any given set of variables that define an edge.

4. An edge is nothing more than an indication of a higher

probability of one thing happening over another.

5. Every moment in the market is unique.

Originally written by CryptoRand, revised and edited by L4z0r.

Thanks for your time