It's easily said the primary focus most needed in mastering how to trade lies not in finding an optimal system to profit from consistently but rather dealing with the package of emotions produced as a result of our trading activity. But some forget that although trading textbooks might define the most common place feelings that are distinctive to most traders, namely fear and greed, they often forget other catalytic emotions that almost always lead up to the extremity on both ends of the scale.
This broad definition of what emotions traders need to be aware of doesn't compensate them for the frustration gone through when faced with the knowledge to vastly identify with either fear or greed but struggle to cope with comprehensively dealing with the specific cause of the emotion.
The minute there's a realisation that our trading abilities might be beyond what we thought was suffice we immediately plant the seed of doubt in our minds that we aren't good enough at what we doing which has a tremendous impact on our self confidence.
Doubt, being a secondary emotion to fear, is defined as uncertainty swirling around in the mind stemming from a difference in a perceived outcome which is expected and the actual occurrence of such event. The best way to describe it would be to compare it to a gap in the mind between what you think will happen and the eventuality of it occurring.
When confirmed, the void between the gap makes the mind feel the need to understand the reason behind the difference, unaware that in the height of fear all possibilities seem likely. Your mind starts filling up with scenarios of what could've gone wrong which doesn't help at all since the amount of variables involved in trading provide an infinite number of scenarios that could unfold.
How does doubt introduce itself to the new trader?
If new traders have never encountered the various types of market conditions an asset class can experience at different times, then its expected for them to assume confidently, only having found a system that's worked well in current conditions during the peak of the sentiment, the system they're operating could reliably be implemented on a continuous basis and expect it to churn out handsome profits consistently regardless of the market conditions.
Nothing can be farther from the truth which becomes apparent when the sudden transition between the markets complacent thinking is replaced with fresh retrospection, shifting the market's sphere of movement and direction into a motion that deviates from the profitable system. This leaves the trader negatively affected after coming off a high built up during the time the system worked till now when it only produces loss after loss, denting confidence and introducing the emotion of doubt into the mix.
Do they ever come back from this setback?
Of course they do depending on their willingness to take on an active approach in understanding their emotions and the effects they have on the decisions they make in the process of trading. It also comes down in accepting the foundational years of trading will not be showered with profits but rather how well you embraced the learning process above bragging how little you did to reap reward.
Throwaway the idea ingrained by online trading ads claiming to offer the "secrets" to trading the markets in favour of a accepting the wealth of information required isn't broadcast through "Get Quick Rich" schemes but rather the amount of time spent observing the markets behaviour and more importantly...yourself.
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