Ever since we were young, we have learned all the rewards life has to offer as well as its bitter pains. It can feel like good times and bad times were thrown randomly upon us. When it comes to day trading, your brain will track down your most painful trades, and your best trades as well.
This is your amygdala at work. It is the subconscious part of your brain that tries to naturally protect you physically and mentally from any harm that could be directed your way. Your brain will store this information. But day trading offers you the ultimate contradiction. If we will inevitably encounter rewarding situations and painful situations, how does one avoid the psychological damage done by this constant chaotic flux?
Each human being perceives and handles pain differently. Factors such as your upbringing, genetics, and surroundings all impact this. In the markets, traders who keep going back and forth between winners and losers can become extremely emotionally imbalanced as their brains try frantically to eliminate the pain.
Thus lies our ultimate conundrum:
How does one remain psychologically stable while enduring the ups of winning with the downs of losing?