There is nothing worse than confinement, or so they say. The same could be said for the trading industry during lockdown. And whether it's due to a global pandemic or not, shutdown can be a great learning opportunity for traders. It's been roughly more than a year since the markets have been subjected to the turmoil of the coronavirus pandemic - so what can traders learn from lockdown going forwards?
4 Lessons Traders Should Learn From Lockdown
1. Continue to stay calm when things go against you
As a trader, you must maintain your composure under pressure - whether that’s the pressure of working from home during lockdown or market pressures. On any given day, it is impossible to predict where the market will go. As a result, there's no need to panic if things go wrong unexpectedly. Instead, simply monitor how your trades perform and make changes as needed.
After a potential breakout, sentiment will usually turn negative. Prices will fall sharply. Margin calls will be made, and the market makers will not impress anyone by buying at the lows. In short, when prices move against you (and they often do), don't panic. Instead, consider strategies for getting back into the pre-crisis mode, which might be called a fallback zone. This is the mode that permits you to function best when facing an unusual challenge or a crisis.
Whether you're a beginner or an experienced trader, we all experience loss at some point. How we deal with losses plays a crucial role in our ability to stay in the game. The emotional roller coaster of trading can lead to sleepless nights and feelings of despair. Most people only focus on risk when entering a trade, but the risk isn't just based on the setup. Emotions play a role too.
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2. Continue to work on your focus and concentration strategies
Lockdown due to a global pandemic means working from home - and it can be tricky. Therefore, the best approach is to keep your focus and concentration on the job at hand. For instance, if you need to do something outside your market scope, make a list and make sure you complete everything in the proper order.
When you're at home, it's easy to fall into a pattern of busy work – answering emails, checking and sending texts, and social networking throughout the day. It's essential to leave the house every day (even if just for 15 minutes) to refocus and get a change of scenery. Getting away from distractions can also help you relax and be more focused - this is definitely a valuable lesson to learn from lockdown.
While working from home has many advantages, it's not without some inherent difficulties. One of these is the perennial fear of getting too much time on your hands, which leads to an underutilization of skills and experiential opportunities. Nevertheless, it's better to be occupied than to risk boredom and job dissatisfaction. Keep yourself busy by keeping in regular contact with clients or other traders.
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3. Continue to take care of your mental health
Staying mentally healthy can be difficult during a pandemic. Getting out of the house is one of the best ways to ward off stressors. On-the-job stressors are detrimental to worker productivity and morale - so try not to let stress build, and don’t overwork yourself when working from home (it’s easy to do!).
It's essential to take steps early on to reduce this stress. One way to combat stress is by carving out some time for self-care throughout the day. Some examples of self-care are taking a walk, doing yoga, or cleaning your home. The benefits of these activities are immense. So get up from the desk and do something that will make you feel better! This practice will allow you to focus on clearing your mind and help reduce your anxiety about work.
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4. Continue to stick to a routine
During lockdown, you were forced to work from home - and maybe you still are. This is an entirely different environment than the place of work that you are accustomed to. Developing healthy routines helps you avoid disruptions and distractions that may crop up because of these new home working conditions.
In any industry, being successful is mainly about staying disciplined. Establishing a routine, even if work is primarily conducted from home, will help you be more productive. Having an efficient and reliable workspace will also help with consistency. Finally, make sure your trading space has all the tools you need to trade correctly. If you are used to trading in a particular chair, for example, try to replicate that space as closely as possible in your home office. This will keep you focused and comfortable with trading procedures and tools you have perfected over time.
Working from home is an excellent option for many people, but finding a balance between productivity and home life can also be difficult if not done right. Create a routine and stick with it.