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Trading Psychology Posted by Team Topstep January 26, 2023

What To Do When You Feel Like Quitting Trading

Chess - Check Mate

I was talking with a trader yesterday who had a disappointing year in 2022. He had planned to make 2023 a significantly more profitable year in terms of money, experience, and improvement. However, very early into the new year, he became highly discouraged and was at the point of throwing up his hands and quitting trading for good.

This trader’s experience is not all that unique. I’m sure we all have been through such a process. Speaking for myself, in what amounts to twenty years of trading, I’ve felt this way countless times.

If this is you, before you let go of your dream, you might want to consider some of the matters addressed in this article before making a final determination. 

Reset Buttons Exist for a Reason

First, not only is there nothing wrong with hitting the reset button, but it is also healthy and beneficial to regulate oneself, take a step back for a season, and have a break. Trading is no exception to this rule. We tend to fill ourselves with so much bias that we develop tunnel vision. We need a way to re-approach our trading mechanisms with fresh eyes. 

There’s nothing wrong with taking a break, which may be the best thing to do before you make matters even worse. However, when you re-approach, ensure you are handling your trading a little differently (at least) and better. The difference between survival and flourishing is the ability to grow continually. Once we give up on growth, we secure our failure. 

Everything Is Cyclical

From the best to the worst of traders, everything tends to run in cycles. I’ve seen some of the best earners have dry seasons and even down years. We try to plan for success and never for failure. The result is that when eventual disappointments do come, we aren’t emotionally and mentally prepared. 

This is why I often say and write to never judge yourself according to your best or worse trading runs, as you are likely to over or underestimate yourself. Instead, measure yourself according to your moving average of daily or weekly profits. Then calculate the standard deviations. When you eventually hit a down cycle, you’ll be able to measure yourself more calmly. 

Don’t Turn Support Into Resistance!

Many of our readers live in the United States, which social anthropologists have demonstrated as the most individualistic culture in history. However, you should always appreciate the value of community, especially your trading community. Finding the right community offers invaluable support (so don’t resist that). 

You’ll know which way works best for you when it comes to connecting with others. Some traders are content just posting comments on a blog like this. Others enjoy a chatroom for no other purpose than the social atmosphere, while still others like to dialogue, and some even gain critical and informative data from these gatherings. 

The point is, don’t live alone under a rock. Every trader I’ve known to do so has ended up failing at this profession. To keep your mind fresh, find friends and communities of traders who can challenge you to be better and support you in times of weakness. 

Know Yourself

Sun Tzu says that the warrior who knows themself and the enemy need not fear the outcome of hundreds of battles. Therefore, it’s imperative in all facets of life (including trading) to be self-aware. This involves critical analysis. In other words, in the same way you examine charts, market data, and news, you should also examine yourself. If you are discouraged, you may wait until you can be more objective and not overly critical. However, ask yourself what’s really going on and what factors are contributing to your disappointment. 

For some traders, the problem may not be immediately connected to the market. There may be other things that are taking your emotional and mental energy or eating at your time capital. Any of this could be a primary cause of why your trading has been unsatisfactory, causing you to think of giving up. If this is you, it may be best to confront these factors before resuming your trading. 

Some traders will blame irrational markets, the algos, HFTs, and market manipulation for their failures. Sure, these may be factors; however, these surrogates are no excuse. Instead, there is always something to pinpoint and improve in your trading. For example, maybe you are in the wrong markets, using unhelpful timeframes, or trading in too low (or high) volatility. Perhaps you are working too many (or too few) markets or using a problematic risk-to-reward mode. Or it could be your system is corrupt, indicators or bad, or it may just be a case of poor discipline. 

Don’t Give Up!

Don't give up!


Whatever your trading issue is, there could be a remedy if you consider these steps. The likelihood is this: if you have the true trading persona of motivation and drive, as many entrepreneurial spirits do, then you recognize the tremendous potential benefits of trading. You can earn a living and use your time as you see fit. If that is you, then it maybe hard to give up and walk away; and if you are like me and a host of others, you may have to endure many trials and errors before you find stability. 

However, if you take care of yourself, know yourself, and engage the markets and yourself critically, you can continue to grow in this hobby or vocation. Moreover, the more quickly you can learn from your mistakes, the more your learning curve will flatten.

When Is It Time to actually quit trading?

I can’t give you the previous items to consider without at least acknowledging that trading is not for everyone. You must take care of your financial obligations, as well as your body, mind, and emotions. For some people, trading is just not for them, and it’s OK. We cannot force anyone (including ourselves) to be something we are not.

Lastly, if you are depressed and thinking of quitting, reach out to someone. I’ve recently seen a trader who struggled and made some concerning statements and then just sort of disappeared, leaving others uncertain about that person’s health and overall status. 

Remember, some of life’s biggest triumphs are birthed through great struggle! If you are thinking of quitting, there is probably a reason to reconsider alternatives like the ones I’ve listed above. Let’s encourage each other and contribute to a wonderful trading year. Until next time, trade well!