-Hi guys. 
Thanks for tuning in 
to another episode Nuggets News. 
Today's off-the-cuff star video 
is going to be about trading psychology
and how good traders think
how the market thinks as a whole
as well as some individual mistakes 
that beginners often make
and things that good traders do 
to produce a process 
that's repeatable over time
to continually make money.
If you're following my work you know 
that I've got a bottom-up approach 
to making money in crypto that revolves
around doing fundamental
 research and analysis.
The next most important layer 
is trading psychology. 
Where the market sentiment is at 
as a whole as well as your
 individual emotions and sentiment
and how to control those when trading
or long-term investing. 
The final layer I guess
or the icing on the cake
 is technical analysis 
to look at specific price points 
or market action.
When diving into trading psychology 
there's a few things 
that I think are really important
 to be aware of
and that you need 
to acknowledge before you decide 
that you're going 
to participate in this space
and there's no doubt that this space
is risky and more volatile than
 any other market in the world
and you've got to acknowledge 
that before you decide to jump in 
and throw your hard-earned money in that. 
One of the sayings that I always say
respect your capital.
Too many guys jump
 into this without a plan, okay?
They just hear stories 
of other people making money 
and they just jump in the deep-end 
and throw their money at things
with no real plan or trading strategy.
We're going to dive into all of that.
First off, if you want 
to make money in this space
I believe that-- if you want to be able 
to execute effectively over time you need 
to be aware of trading psychology
and you need to control your emotions. 
We're all only human, we are hard-wired 
with those fight 
or flight inbuilt responses 
and when markets go up
we all get that adrenaline rush
when we see the green 
on the screen we get excited
and that's what creates that forward move
and we've all seen that 
bubble sentiment chart 
when euphoria at the top of markets
and disbelief at the bottom.
And it is, not matter 
how many times you see that chart
it is still hard to control your emotions 
when we get a big ramp in price 
and it's hard to step in
 and buy when prices are falling.
That's your hard-wired human emotions
giving you that adrenaline on the way up
and that fight or flight
 response on the way down.
When you go into that fear mode 
or self-defense mode
 and you're hard-wired
your brain is telling you to take action.
That's why a lot of people buy at the top 
and they sell at the bottom 
because their emotions
 are getting the better of them.
That's the first thing I wanted to talk about. 
We've all got that little inner voice 
in our head and we need to
as in anything at life
 you will get better at trading.
So I've told a lot of guys
and I do a lot of one-on-ones with people
to think of this as running a marathon
you're not going to be good at it straightaway. 
You've got to respect the fact 
that when you do your first trade
your first investment
everyone else in the market
 has done more than you
when you put on your very first trade
so you've got to respect 
that you're just a small fish in the ocean.
These markets are powerful
they are volatile
they don't wait for anyone, they'll chew you up 
and they'll spit you out. 
The markets don't care about 
your account going up or down
they will do what they want to do. 
You've got to acknowledge all those things
before you just jump in 
and think that you're going to make money.
You've got to prepare yourself 
that when you buy something the chances 
are that it's going to go down 
in price at some stage. 
Now, if you can tell me that everything 
you've ever bought
 has only ever gone up in price since
and at no point has ever gone down
you can come work for me 
because that doesn't happen.
By simply thinking about it
from that point of view
 you're already preparing yourself 
for the fact that at some stage something
you invest in is going to go down in price 
and how you're going 
to react when that happens.
That's why we talk about doing
 your research in the first place
and that gives you that conviction to know 
that you've bought something good 
and that you're happy to hold it
whereas if we're just buying on pure emotions
kind of riding that roller coaster
it's very easy to come undone 
and lose control of your trading 
and your investing.
That's why we have sayings like
"Only invest what you're willing to lose."
Accept the risk, accept responsibility
no one else is responsible for your money 
at the end of the day other than you. 
That's why it's important to have a plan.
Not everything is going to go straight up. 
It's important to have a plan of exit even 
when you're into a trade
are you buy these things for the long term?
Are you buying this as
 a day trade or a swing trade? 
So formulate at least some sort of plan 
that will help you control your emotions
and dictate when you buy and sell?
Often we hear those stories of riches 
and that's why a lot of people
 jump in straightaway
but a lot of the time they're 
the exception not the rule.
As in gambling or anything in life
we always hear the good stories 
but trust me there's
 equal amount of bad stories
that don't get disclosed on social media
and I'll talk about that a little bit in the end. 
So, a lot of people enter this 
with unrealistic expectations 
to get rich quick and
 that affects the way they trade. 
If you put on a losing trade
so many people have this mindset that
"Right, I've got to get my money 
back on the next trade."
And that brings about 
what we call suicide trading. 
You lose 50% on a position
you've got actually make 100%
on that next position to break-even
and people go all in on the next trade.
They trade too big
and that's not repeatable
that's not a process that's going 
to steadily make you money over time.
That's the next thing I want you to try 
and get your head around. 
A lot of people in this space have only been
in the market since it's going up
we've got these overnight
 experts coming out
of left right and center
that are posting technical analysis
telling you which coin's going
 to the moon next.
It's so hard now with the internet 
and social media to know 
who is well qualified 
and who has been in this game for a few weeks 
and posting charts up
and like I said, at the end 
of the day you're responsible.
So you've got to be really careful 
who you're following as well in this space.
A lot of people are about
 to get a real harsh reality check. 
Everyone thinks they're a good investor
when things go up but once we enter 
a bear market or a downtown 
or sideways action for
 an extended period of time
a lot of people are about to get 
a real reality check and that's when 
experienced traders rise to the top
when other guys are getting bored
 or throw in the towel.
The next thing I want to
 talk about is emotional capital. 
So, just like you've got your capital
your money that you allocate
to trading or investing
and we talk about being diversified
think of your emotions as a pool of capital
and you're not ever going
 to put all your emotion 
into one position, or all your 
emotion into cryptocurrency. 
Trading needs to be, or investing
a healthy part of your life just 
like anything else in life, okay?
You need to have a healthy balance. 
So you need to have time away 
from the markets each day
you need to know when you're over-committed 
and realize that it might be affecting
your other relationships and then in turn
those relationships come back 
to affect your trading when you're trying
to get that money back 
because you've had a fight 
with your spouse about losing money
and all those sorts of things.
If you're angry at work and you come home 
and expect to be able to trade well
with a clear mind for two hours each night
you've got to realize 
that all this is a balance.
I've done videos about 
how to trade well at swings 
where I talk about
you've got to decide whether or not 
you're going to even trade this
or sit out these wild swings 
and just huddle as the saying goes
because these markets are so volatile. 
And it's probably a good
 intro to the story of people 
that lose money in this space
 even though they've got in early. 
We all hear the stories of the guy
that threw 10 grand at a coin 
and now it's worth 100 grand
 a few weeks later.
But the stories that I like to listen to
and the stories you need to learn 
from are the ones where guys
 bought 1,000 Bitcoin four years ago 
and now they've ended up with 200 Bitcoin. 
They've lost 80% because they thought
they were going to trade the swings 
and build their account. 
As their emotions got the better of them
when Bitcoin went from $3 to $10
they sold some because they didn't have a plan
they're just seeing the green on their screen 
and selling and then again
 when it falls down in price
they panic and think
"Oh, I've made good money now." 
And they gradually wear away 
and lose their account over time
because they're not aware of their emotions
and they don't have a long term 
repeatable strategy or plan in place.
I guess the next thing I want to talk about
is focusing on the plan
 rather than the profits 
or your winnings. 
Rather, people say, "Do you take profits at 20%?" 
Well, to me it's more about
if you enter a trade or an investment 
with the idea that that's going to do well 
over a set period of time
if the price starts to go up 
and our assumptions starts to play out
we don't take it off just because it's doubled
or tripled, or even
 if it's gone up 10 times in price
that's not a good reason just to take it off 
if your assumption still 
hasn't been reached yet. 
If you bought a coin 
because you thought 
it was going to do really well 
in three years time
there's nothing ever wrong 
with taking some profits 
and re-balancing your portfolio
but a lot of people click the sell button
and they sell all at once
when they've actually got in early
on a really good project that other people 
are only just starting to discover. 
You've got to think about all those things
and that formula, and that exit strategy
rather than letting a bit of profit dictate 
your thoughts and your actions. 
This is all part of that trader psychology 
to becoming a good rounded overall investor.
Making money actually isn't that easy
and as I said, we all hear stories of the guy 
that bought early, but so many of those guys
have sold early as well
so it's not easy to make big amounts of money.
It is very hard.
It's mentally taxing.
I've been through four big market cycles
since I got in these markets in 2012
and every time, and it's still hard.
When Bitcoin and Ethereum fall 
from their all time highs
 a couple of months ago
60, 70% it is still hard
and there's still that little voice
 in your head that says
"Maybe this is all over." Okay?
You've got to fight that voice
you'll get better at it over time
 like running a marathon
you're going to build up
 your trading psychology
and improve the way 
you can control your emotions.
The next thing I want to talk about
 is not becoming the trade.
A lot of people feel that the trade 
or their account balance represents
and becomes their self worth. 
So if you make a good trade, everyone wants 
to post on social media
 but if you make a bad trade
everyone wants to kick themselves 
and beat themselves up 
and make that trade personal. 
Now, you need to get to the point 
where you've got a plan in place. 
And successful traders only need 
a win more than 50% 
of the time or not even that
if you've got 40% losing trades
but 10% of breaking even 
and you control your position size
you're diversified, you shut down losers
and you let your winners run 
to the right levels, okay? 
At the moment there's a lot of guys 
in this space that have
 only been in this bull market
and I know personally in the last few months 
we're striking at 100% for trades 
and coins we're investing in
and as I said, the true test is yet to come 
when we get a downturn in this market. 
Think about all that stuff, about having 
that repeatable process, and are you gonna-- 
are you prepared for if we get a downturn
or are you just striking it lucky
because we've been in a bull market?
So that plan becomes really
really important. 
And you need to get to the stage 
where you're congratulating yourself 
on closing a trade that's a loser 
because you are doing the right thing 
and sticking to your process 
rather than beating yourself up, or saying
"I'm just going to wait for this 
to break even and then I'll get out" 
or, "I'm going to double up "
"and make my money back 
on the next trade." 
You need to congratulate yourself
if you're sticking to the plan 
for closing down losers
because we're never going 
to win 100% of the time.
Now, I guess the final thing
 is self reflection.
Once we've done all this 
and you're aware of your emotions
take some time to go for a walk, clear your head
maybe even if it's only once a month. 
Do something 
that completely clears your mind 
and think about your trading process
and if you're improving
if your plan's working 
or does it need to change?
You may have had
 a week of all losing trades
but if you stuck to your plan maybe 
there's three weeks 
of winning trades coming around. 
So, self reflection, taking that time
to work out what's working for you 
and what may need to be improved 
or changed in your personal strategy.
Making money is not easy
it's not as rosy as everyone's presenting 
at the moment in these bull markets. 
I do a lot of work with this sort 
of stuff in my private group
and one on one with people
and those links are down below
 if you're interested. 
But, I hope you guys have enjoyed this video.
If you want me to dive in deeper 
on any specific topic in trading 
psychology in the future, let me know. 
But as always, guys
 please give this video a like
share it around
subscribe if you haven't already
and as always, thanks for tuning in. 
Cheers guys.
