We're your best review guide

Forex trading psychology

Forex trading psychology Johannes Röll Visitors: 347 ★★★★

Forex trading psychology - trader's prejudices 
Whatever the trader does, the trading psychology always influences his actions. Subconsciously or consciously, every market participant is afraid of something. Such emotions are experienced by any person who makes deals on the exchange. Psychology of trading on the Forex market. However, the winner is the one who can manage himself even in tense situations. 
 
The most frequently made mistakes and trading psychology 
Trader psychology 
 
Beginners and even experienced traders can do some wrong things with strong emotions: 
 
Do not put a stop-loss or constantly push it back, only aggravating the situation. The reason is that it is difficult for a person to admit his or her wrong and close the unprofitable position. He hopes that the drawdown will be able to survive, but in the end only increases the size of their own losses, although he could cut them off at the initial stage, and the saved money to spend at the entrance to a profitable position. 
Close the deal at a low profit. Explanation in the context of trading psychology - a person tends to take at least a few points more than the initial value, than to exit the position with a loss. Instead, we can recommend the use of a trailing stop or manual movement of an order that limits losses. Then the position will be closed by the stop-loss, but by that time it will have been in the profitable zone for a long time. 
Enter the market before the final signal formation on the chart. It seems to the trader: if we wait for the ideal moment, it will be too late to enter the game. However, premature entry only leads to losses due to chaotic actions. This is how the trader's psychology works. But this fact can be changed if we observe discipline and wait for the confirmation of the indicator signals. 
To see missed opportunities in every market movement. But no trading strategy will allow earning absolutely on all local trends. You need to choose your own system, and work on it. The market will have enough opportunities for you to earn. 
Excessive Stop Loss. It seems to the trader that if he places a pending order according to the recommendations of a trading strategy, it will be a close distance, and it will just beat him out of the market. However, experts do not in vain specify a fixed distance in points: this parameter has been tested many times. If the stop-loss is simply overestimated, it is tantamount to agree to the loss of more money than a possible minimum. 
How to find a way out of repeated situations? The Psychology of Forex Trading 
First, you must learn to ignore your own emotions. You must think rationally. You should enter the market if the conditions are met for that. When due to the deposit drawdown the ability to adequately analyze the situation is lost - remember that the trading result consists of a certain set of deals. Among them there are also profitable ones. This is called for by the psychology of trading in the Forex market of a successful trader. 
 
Trader's psychology 
 
Trading efficiency largely depends on a trader's mood for work. To be positive, you need to have a good sleep, physical activity, a balanced diet, rest enough time, have a hobby to switch attention and relax. 
To make a stable profit, you need to test it on a demo account for a long time after finding a trading strategy. It is important to understand every nuance, and only then apply the algorithm of work on a real account. Choose a lot of size so that the drawdown or profit on it do not cause too much excitement. Psychology of Forex trading. You should listen to your feelings. It may happen that in the context of trading psychology, the tools and methods used by you will cause some discomfort. This is a sign that they need to be changed. For example, someone is comfortable working with a trading system, in which trades are held open for several days, while you - prefer the activity on M5-M15, with the closing of deals for a couple of hours. 

 

Johannes Röll
Johannes Röll

Johannes Röll was born 1978 in Brilon,Germany. Graduated RWTH Aachen University. Over the past ten years he worked as Head of the plastic card team, where he was mainly responsible for the development of the distribution, Head of sales Department and Financial Analyst,where he got experience in planning and support sales figures for branches. For the present he works as freelancer

Comments 0

Recent Projects

Forex trading psychology

EUR/USD soars amid rumors of an ECB rate hike by 0.5%

While the EUR/USD pair showed a short-term bearish profile early in the morning as part of a correction after yesterday's testing at 1.0200, it then showed a sudden sharp increase, reaching a maximum at the moment at 1.0250.

Forex trading psychology

Oil price in London - Brent

On the electronic platform of the European futures market ICE (Intercontinental Exchange), symbolically located in London, spot transactions are conducted daily, in particular, for Brent oil from the North Sea (spot market) or in the form of forward contracts (futures) for 1000 barrels of Brent oil with a maturity of 3 months, 1 year or 2 years.

Forex trading psychology

"Futures" are financial instruments used to predict future changes in the underlying asset

"Futures" are financial instruments used to predict future changes in the underlying asset (stocks, stock index, etc.): You buy or sell a certain amount of this underlying asset at maturity and at a predetermined price. But futures are very risky speculative products.

Forex trading psychology

Gh0stly Gh0sts-the first omnichain NFT collection

In recent days, the premiere of the unique collection NFT: gh0stly gh0sts. Although there is little interest in the project at the moment (the Twitter profile @gh0stlygh0sts is watched by less than 12,000 people), it can already be said that this is something groundbreaking.

Forex trading psychology

What is a factoring contract and what elements should I pay attention to?

Factoring is a financial service that few people have heard of until recently, but now it is gaining popularity among entrepreneurs every year. This is one of the most effective ways to maintain the financial liquidity of the company and ensure its free access to capital.

Forex trading psychology

This article, first of all, will be useful for beginners in the Forex market.

Many newcomers ask such questions: "How to start trading on the Forex currency market, where to do it, the first steps in trading" and other similar questions.