THE GREATEST PSYCHOLOGICAL CHALLENGES OF FOREX CURRENCY TRADING

Updated: Feb 22, 2019

Beloved Trader,


So you are trying to master trading mindset and want to stay in control of your feelings?


Nicely done.


You just approached an essential step in your current trading journey without even knowing it.


Emotions usually are what makes or cracks traders.


Even an average strategy can be rewarding if applied diligently. Exactly what causes a bad trade to morph into a new catastrophe is your response to it.


By knowing your psychology as well as the fear/greed that we feel when making and losing money inside the markets, you could begin to put techniques set up to control all of them. You’ll then avoid the particular cry of rookie investors around the world “It must turn around quickly.. let me hold for a little longer”.


Margin Call.


Here are a few techniques you should use to assist you win the struggle between your heart and mind.


Lesson 1: Never get attached to a losing trade.



It is easy to become connected to trades, particularly if you’ve been holding it for a long time. A particular sense of familiarity comes into play with the market movements, your devotion for the trade growing more and more with each candle.


However the market will never love you back again.


The Forex trading market is more like a psychotic nymphomaniac with access to your credit card than the girl of your dreams. In case you get married to a trade, it’ll ensure to take your house, kids and dog. Leaving you behind with absolutely nothing but a box of memories and a damaged heart.


Treat each trade like you’re negotiating on the internet. Be a rude dickhead. If the market doesn’t give you what you want, close up the trade and say “don’t allow the door strike you on your way out”. And then wait around for another one.


Lesson 2: Keep a trading record



Exactly why did you open your latest trade?


Was it because the conditions of your strategy aligned flawlessly allowing you to pull the trigger?


Or were it close… however you got bored and opened the trade anyhow?


Or was it due to you were in a good mood because your home team won a sporting event and you desired to celebrate by trading?


Write it all down! At the summary of the month indicate your reasons to open a trade and how closely you followed your trading plan.


In case you traded like an experienced killer, celebrate with a beer or three irrespective of your monetary success. Its not all month will be a winner. The one thing you can control is how you respond with the market movements, and if you got a strategy and executed it precisely you’re way better than 99% of traders.


Well, once you begin to have an understanding of your psychology, you can make use of it to your advantage!


Really don't concentrate on the win percentage since it is not an indicator of your success. However when you learn to master your trading psychology it will increase your percentage.


This is due to the simple reality that you make less faults in regards to emotional trading.


When you gain more experience, you get more of an understanding of when not to trade.


You should have the ability to adapt your feelings and/or emotions to make a trade.


Let us say you have got an awful day, you are angry at a friend and they have let you down. In case you took a trade in this state you would usually make rash decision.


A professional trader, however, could still trade and not let these feelings impact his decisions.


Think of Usain Bolt entering the zone before a 100 m final – nobody and nothing can penetrate his mindset before that contest.


The same can go for trading. It is definitely very difficult.


You will have to figure out how to control your emotions, because you are unable to stop them.


With experience and time, you will be able to better handle situations and identify scenarios where you feel confident enough that you can trade.


Thus, being in control of your feelings will lead to more trading opportunities. Isn’t that exactly what you want?

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