Fear and greed — two of the biggest drivers of the trading game.
They are ancient emotions programmed into our brains to keep us safe in the wild. But in the sexbot world of modern financial markets, they are not so much protection as they are the things that fuck up your trades and fuck up your strategy and fuck up long-term strategy and fuck up your account.
For traders, it is not a “nice to have” understanding of fear and greed. It’s essential.
And, in this comprehensive guide, we will cover:
- What Fear and Greed Look Like In Real Trading Situations
- Why they’re so destructive
- How top traders manage them
- Emotional trading survival strategies you can use right now
- Mindset swings to become a cool and calm trader
Let’s get mentally strong and powerful between the ears with the psychology of trading—and learn how to tame your thoughts before they take control of you!
What is Greed in Trading?
Greed is when your trading is motivated by an intense desire to earn more money than the market is realistically offering. It results in impulsive decisions, disregard of risk, and sacrificing discipline for a shot at greater gains.
Common Signs of Greed:
- Looking for “just a little more” and holding the trade too long
- Too much leverage for fast gains
- Not sticking to your trading plan& chasing profits
- Pyramiding without defined plan added to winning positions
- FOMO (Fear Of Missing Out) On Breakouts Or Trends
Example:
You’re up $500 on a trade. You plan said you would sell for profit if the investment increased in value to $400, but the market still appears strong. You take the position — and within a few minutes, the market turns around. That $500 profit becomes a $200 loss.
That’s greed in action.
What is Fear in Trading?
Trading fear is the emotional response to worry of losing. It clouds your judgment, makes you question your entries and frequently forces you out of winning trades too early.
Common Signs of Fear:
- Hesitating to enter valid setups
- Trail stop losses up too tight to protect against pain
- Getting out of winners too soon
- Staying away from the market after a down period
- Normal selling Price drop due to selling, in a normal pullback in the market.
Example:
You see a setup that lines up 100 percent with your strategy. But whoa, there goes your latest trade, and fear starts to settle in. You skip the trade — and see it go right to your target! Later, you chase a bad trade, because you are angry.
That’s you operating out of fear.
How Fear and Greed Work Together
Fear and greed rarely work in isolation — they feed off of each other in a cycle.
Greed gets you into a trade that’s too large.
Fear kicks in with the market going slightly against you.
You panic and exit. And then the market turns right back in your direction.
You’re full of regret —and greed kicks back in to take it back fast.
This feedback loop leads to random, reactionary trading, which is the opposite of the systematic, disciplined approach required in order to succeed.
Why Terror and Desire Are Driving Trading
Both fear and greed are hardwired in our brain’s limbic system, specifically the amygdala, which is where emotions connected to survival are processed.
When you hit the red in your account:
- Your body makes cortisol (the stress hormone).
- Your heart rate increases
- Logical thinking drops
- Emotional thinking takes over
When you’re winning:
- There’s a rush of dopamine (the pleasure hormone)
- You feel unstoppable
- Risk feels irrelevant
- You start taking trades which make you high
These are the chemical reactions that overwhelm your ability to be logical.
That’s why “discipline” isn’t good enough—you need systems to protect yourself from your own brain.
How Successful Traders Master Fear and Greed
Top traders don’t eradicate emotion — they harness it.
Here’s how they do it:
Pre-Defined Trade Plans
- They will never trade without:
- A clear reason for entry
- A certain stop and a take profit
- A specific percentage of known risk (usually 1-2%)
- It eliminates guesswork and restricts half-time decisions.
Position Sizing
If they lose, the amount is so small that it doesn’t take on an epic or traumatic weight. If you’re emotionally invested in the outcome, you’re trading too large.
Journaling Every Trade
They journal every trade — what the author did well or did poorly, what the author’s emotional and confidence level was, what could be done differently. This is useful to find the emotional patterns through time.
Walk-Away Rule
If they experience:
- 2 consecutive losses
- A revenge trade urge
- Elevated stress
They walk away from the screen — every last one of them.
Mindset of Long-Term Thinking
They give a crap about trade. Or even one week.
They worry about monthly consistency and yearly performance.
This attitude decreases the influence of each trade and mitigates emotional impact.
How to Manage Fear and Greed (in 5 Simple Steps)
Here’s a system you can start using today:
Whisper 1 – Check-In With Emotions Before Tightening The Cuffs
Ask yourself:
How do I feel today?
Am I trying to recoup losses?
Am I getting cocky as a result of a major victory?
Where the answer is yes to any of those, step of the risk — or don’t trade at all.
Step 2: Making Use of a Pre-Trade Checklist
Example Checklist:
✅ Is there a confirmed setup for this trade?
✅ Do I have an entry, stop, and target?
✅ Is this trade to my daily risk threshold?
✅ Am I calm and focused?
Proceed only if all dates/slide boxes are checked.
Task 3: Journal Emotional Patterns
After each trade, log:
Why you took the trade
Your mood when you enter and leave
Whether you stuck with your plan
What you learned
Patterns will emerge. Over time, you’ll figure out what causes your fear and your greed — and how to stop it.
Step 4: Set Time Limits
Stop staring at the screen all day. Micromanaging the market also ups the stress while creating an impetus for impulse trades.
Try this routine:
20–30 mins of market scan
1–2 high-quality trades max
Review session, then leave
Step 5: Emotion Visualization Exercise
Before your session:
Close your eyes
Imagine you see loss over a trade and you manage to stay cool, calm, and collected.
Imagine Missing a Trade And Not Chasing
So, dream of that win, and have the discipline to walk away.
This “mental rehearsal” teaches your brain to be calm under actual conditions.
Final Thoughts: The Real Truth About Fear and Greed
The truth?
You will never get rid of fear and greed completely.
They are part of human nature — and part of trading.
But you can learn to trade around them.
Success doesn’t come from having no fear. It’s a product of being disciplined when you are afraid.
And your grams when you are excited.
The world’s greatest traders feel fear and greed like you do, but they’ve created systems, routines, and mindset structures that help them keep it from ruling them.
And so can you.