How to Keep Under Emotional Control in a Surging Market

How do you keep your mind straight in a surging market like the one we're having now? You know, it's so easy. You look at it, it's going, you want to catch up, you want to be able to take advantage of this stuff. Yet there's another part of you saying, gosh, you know something, this is an over inflated market. You know, it's a bubble, it's going to burst yet, oh, there's all that much money. But I've got to get it, I've got to get it. Everybody else is getting theirs. You know, it's, it's, it's like it's really a roller coaster going up and down, up and down, up and down. How do you keep your mind straight? You know, there's a wonderful cartoon that literally shows a roller coaster and two men in that roller coaster going up and down, up and up and down, up and down. One's having mania. More, more, more, more. The thrill, the thrill, the thrill. The other is scared. No, no, no, no more, no more. You find the same thing in these surging markets. And the key is it's so easy to get sucked into these vortexes and start making really stupid decisions. How do you go about making sane decisions in a type like this? Well, first of all, let's start asking what's going on in your head. Let's take a look at emotionally, what are your vulnerabilities? If you know that you need a disciplined, impartial mind, what I want you to start noticing is the pulls, the vortex of emotion pulling you into the surging market. First, let's start with what an emotion is and what it's not. First of all, an emotion is not psychological, it's biological and takes over psychology. It's actually from a technical sense.

A biological action potential that coordinates action between you. That's the trader and the environment, that's the markets. All of a sudden you say, oh, wow, okay. The maniac and the fear are just simply emotional responses to the environment. Yeah. And you're the organism. The key is, is how, how do you do it? If you use default programming, you're going to be taken through the ringer. You're going to be highs and lows, highs and lows, highs and lows. That's this, the survival instincts and the default programming that you're built as a human being. We're asking for something more. How can you use emotional intelligence to respond to the kind of surging market so that it allows you to kind of have a level head to take Advantage. Advantage of it. So we got there. But let's take a look at the emotions and let's start here. The first one, the foremost one that we look at is what we call euphoria. Euphoria is the emotional state that makes you feel good. It's dopamine. It's the reward chemical. And another person at another time has called it irrational exuberance. You would know it as overconfidence. You see all this stuff happening and you say, God, I got to take advantage of it. I feel good. I need to go in and take my share of this euphoria. That's the first thing to notice. Unfortunately, euphoria as an emotional state, commanding mind has a problem. It views that the good times are going to roll on forever and you begin to discount risk. Okay, so euphoria is not a good emotion. You can't feel good. Your job is to maintain disciplined, impartial mind. The second is greed. That's when you see something and you want it. Okay, you see that I feel greed. I should be able to take all this stuff for my own. Unfortunately, it's short term. To be seduced by it is to leave good judgment behind. So that's the greed. The third one, less talked about, but very relevant. Lust. If you don't think you're having lust when trading in a surging market, what I want you to notice is this. Have you done any impulsive trading?

Have you got into trades and you've seen things and you just started adding more and more? Have you felt that lust to chase the trade?

Lust is going to have you chasing trade. It's not going to put you in a position to see what the market's willing to give you. Lust is going to have you chasing the trade.

The next one you'll probably be very familiar with. FOMO fear of missing out. How many people watching this, watching this surging market has been on the sideline? I'm missing out. I'm missing out. I need to get in on this before it's taken away. I need to take it. The fear of missing out on those profits, you want, you need to get in. You need to get in. But I want you to hear the urgency.

Okay? The urgency there, that's the key, is if the emotion is urgent, it's not the calm, patient, disciplined mind that we're looking for. The last emotion that we're looking at in this particular. Well, what are the emotions of a surging market is fear of loss. A lot of people do stay on the sideline. They're so scared that the bubble is going to break right on them, that it's going to give out, there's going to be a market correction. It can't go on forever. That what they do is they never take advantage of the momentum in a surging market. So there you go, you have it. From the mania of euphoria to the fear of, the fear of loss. What do you start doing with this thing? The very first and foremost is what I would call emotional first aid. Is you go back and you realize that emotions are biological. You can use biological elements to start managing the intensity of the emotion so that it doesn't take over the trading mind. Now what I mean by that is breathing, muscle tension and heart rate are all part of, of an emotional complex. Okay? You literally alter the way you breathe. And when you're in your for you think about.

Notice that diaphragmatic breathing or fear holding what you're doing is you're accelerating the emotion, moving toward fight, flight. That's not what we want. We want to go in and re establish, say I can produce diaphragmatic breathing. That's that moving air into belly, expanding chest hold, release, notice the tension, let the tension drain, drain, drain. Feel the heart rate slow down, slow down. And suddenly what happens is that mania or that fear starts subsiding and this sane mind starts showing back up. That's what we're looking for. That's the first aid. Beyond that though, what we have to start looking at is what are the beliefs that are behind the emotions? Okay, this is about literally the drivers of the emotions because ultimately what we're looking for are the beliefs that you're projecting onto the markets and as a function of your ability to manage uncertainty and risk.

That's what we're looking for. When you're looking at euphoria, when you're looking at greed, when you're looking at lust, you're looking at beliefs about chasing trades, about making things happen.

When in fact trading requires for you to see what the market will give. It's a different belief, it's a different attitude. The fear based stuff, FOMO and the fear of loss. You know, you're sitting there, you're on the sideline, but you're on the sideline for two things. You have fear about getting in, which is not going to allow you to get in from a really right thing. FOMO is going to have you jumping into trades when it's not to your advantage. Fear of loss is going to keep you from entering trades that would have been to your advantage. Getting back to the belief, though, it's going to be about your adequacy, your mattering, your sense of worth and your sense of power. That's what you're looking at. A patient, disciplined ruler is comfortable with bringing the mind to the moment to perform. He's comfortable about not knowing that it's going to win or lose. He's going to perform well. And if he performs well, his rules, his methodology is going to give you an edge. So you go back from I notice that I'm getting out of control here. I feel the surging market, and the feeling of the surging market in me is cause for me to calm the emotion down. Okay, you do that through emotional regulation. Then it goes down to now. I need to check belief. That's behind that emotion. That's where the real magic of this work is. If you're looking to say, you know something, I need to be able to maintain a disciplined, impartial mind under the moments of stress, under the moments of real market fluctuation of surging markets. It's something that's learned, friends.

Rarely do you catch it. It's something that's learned. And if you want to learn, come to our website, come to one of our webinars, watch the videos, get the free ebook. But the key is learn about how to become emotionally intelligent in the time of uncertainty, in the time of surging markets. That's when you need to have your act together. That's when you need to get your head right so you perform well in the heat of the moment. Come and learn, friends. Thank you very much.