Understanding the connection between negative charge energies and profitability is very important. In most cases, there is a very thin line between each negative charge energy, as one seems to lead to the other.
In this article, we will be looking at the relationship between fear and ego, as these two negative energies almost have the same effect on the mind of the trader.
How Fear Works
At the most basic level, fear blocks perception and objectivity while trading. A trader caught in the prison of fear will always act based on wrong thought patterns that stem from distorted perceptions of what the market represents.
Fear sets your mind on an object, and all you see is the object of your fear; this creates a blind spot to other very important factors that meet for objectivity while trading.
Recall when you started learning to drive. You were so focused on the road that you could barely read any road signs or even what was written on a billboard. In this example, we can see that as important as setting your eyes on the road is, when done out of fear, it can make you ignore important road signs and possible directions to your destination.
The resulting effect is that you could possibly experience the accident you are so afraid of.
How Ego Works
Just like fear, ego has a way of blocking obvious market behaviors from being perceived by the trader. When you have ego issues, you always believe you are right and the market is wrong, so you will rarely accept what the market is saying at the moment and take appropriate action.
Those with ego always experience the same bitter lesson taught by the market to traders with fear. I wrote in my series, “The Market in Your Mind,” that the market must be seen as king and must be followed. The market does not follow anyone because the market is simply the greater force between demand and supply.
When you fail to humble yourself to follow the market, be sure to experience a forced awareness.
The Relationship
Fear is simply the first experience of every egoistic and overconfident trader. In most cases, they start out being very fearful and experience all the negative effects of fear as negative energy. Over time, due to resilience and an openness to changing the components of their mental environment, they begin to overcome fear and are plunged into the realm of trading clarity and objectivity. Over time, this set of traders begins to experience the market in a new and profitable way.
But alas, they have not learned that familiarity breeds contempt. They become overconfident because of strings of profits and fall into the illusion that they control the price at all times. At some point, you see them speak as though they are prophets and will never cut their losses until it becomes overwhelming.
A once fearful trader has now become an overconfident fellow heading toward imminent failure.
Bottomline
The fact that you have overcome fear is not a ticket to trading recklessness. Mindful trading and objective analyses are necessary to keep a trader in check. The fact that the market is still king should create a consciousness in your mind that you can’t afford to be reckless at any moment.
When you understand how thin the line is between fear and ego, you will see that as a trader, you just have to stand on the line with a high level of care, consciousness, and mindfulness.
