As we learn more about the importance of emotional information in trading decisions, it’s challenging to switch to looking at feelings and emotions as data. It’s doubly hard because there is so much misinformation still floating around!
To that end, I was happy to see Psyblog publish information about a new study supporting one of the leading recent findings in emotion research. It’s simply this – at their core, emotions fall into two categories: like it/don’t like it or want more/want less. This is the classic approach/avoidance scheme in psychological research.
It’s also a simple schema to get you started when you are trying to understand what you are feeling about or in a trade. Ask yourself do I want more or less of what is going on? Which parts of what is going on do I want more or less of?
Allow the feeling, and therefore the data, to reveal itself to you. Listen to your body not your brain.
Once you have the parsing, ask why. Why do I want less of this? Why do I want more of it? Knowing which is which and why can be very helpful. You will get access to the source of information that your brain and thoughts are relying on. Having this fuller data set at your conscious disposal can often open up the best path to seeing the higher probability decision.