A successful trader must be heartless and impartial, as the robot Werther, but apart from this, even the manifestation of joy in the form of characteristic laughter is strictly prohibited. If emotions prevail over the mind, from this point, most likely, significant financial losses will begin. The main enemies of the trader are greed, fear and hope, but we'll talk about them a little later.
In modern practice, there are plenty of examples where promising initially market participants completely poured the deposit, being in the grip of emotions. Of that 95 % of statistical losers, about 90% loss because they do not know how to cope with their internal opponents.
How do emotions prevent you from working at financial markets?
The root cause of all troubles is almost complete blocking of the thinking process, as well as control over the behaviour of the trader, who passes into the power of one or several emotions. In such a situation, it is challenging to bring your stay in the market to some justified logical conclusion. Most newcomers in such cases commit inappropriate actions that seem to be at least inappropriate to a cold head.
The ability to overcome emotions is one of the main whales of success when trading in any financial market. A currency trader who has defeated himself can be proudly called a disciplined market participant. Moreover, it is worth a lot. It is not difficult to make the first step to the goal, and it is enough to put a simple experiment on yourself. In any situation, the optimal points for entry and exit from the market should be determined clearly, explicitly and individually. If the situation is under control, the transaction can be quickly closed at any time, either in order to fix a profit or in order to exit the Forex market with the lowest possible loss.
How to learn to control your emotions?
Fortunately, the answer to this question has already been found. The first and most important thing is to destroy the atmosphere in which unwanted emotions feel good and begin to grow. To achieve good results is obtained through discipline, the use of a proven trading system that calculates all possible options in advance. The basic principles of work are always the same:
• Specific conditions for opening transactions.
• Clearly defined requirements for closing positions.
• Conditions for placing stop orders and profit-take orders.
Also on the protection against unreasonable losses becomes the capital management system, which is recommended to develop individually, following generally accepted rules. In no case it is impossible to violate the selected postulates, if you can at least do it, the deposit can already be saved even being the greenest newcomer. Understand once and for all for yourself, you come to the market not to win, not to lose. No matter how paradoxical it may sound, but as long as you sincerely do not believe in this installation, there is no question of any earnings.
Let’s suppose you decide to risk a sum of $ 100 and work on the exchange 20 days a month. Thus, in a day, you can lose no more than 5 dollars. If you have lost 15 days in a day, it means that you need to stop trading and not open trades today immediately, plus two more days. Free time devote to reflection, analysis of the incident and debriefing. Have you Lost for the first ten days all one hundred dollars? Then you will have to think and reflect until the end of the month. Otherwise, expect new financial losses. Such tactics are hard to come by, but it has been tested for years and really works, in the end, you will always have time to lose money, but the gain must be conscious, it does not stand in a hurry, and you need to come to it.
The three most dangerous enemies of a successful forex trader.
Enemy number 1 is the greed. Insatiable market participants are always eager to get more, and very often, this desire is not justified by anything. Such people, as usual, are not very restrained, they are always in anticipation of the possibility of hitting a big jackpot, and in their eyes, as in the cartoon about Scrooge McDuck, dollar icons glow. Greedy personalities are ready to incur substantial losses, almost do not look at the graphics and all this for the thirst for profit. As you understand, a trap for draining a deposit for such traders will always work correctly. The logic of the greedy trader cannot even be called logic, because he thinks that the more he risks, the more this risk is justified and the more profit is expected at the finish. The result, unfortunately, goes precisely the opposite.
Fear is the other extreme, which is expressed in fear of loss. The risk, in this case, is not comfortable in any of its manifestations. The fear of losing even a couple of dollars sometimes binds so much that there is no time or place left for a person to master a new profession. A trader who is held captive by his own fears often closes trades with minimal profit, losing out on the most delicious opportunities, but it’s challenging to oppose something against the chilling fear of going negative. As a rule, such as market players tamper, lose a little, but also earn a little. They cannot fully use all the opportunities offered by the market.
Hope is one more emotion that closely follows the players of the forex market. Every person comes to the exchange to make money, and every trader hopes for it. In most cases, the hopes remain hopes, and the deposit inevitably melts. Very often, such people believe in their victory before the last dollar - this is the critical phrase “until the last dollar”, after the final defeat, other, much more destructive emotions replace hope. A trader embraced by the fetters of belief has no time to make plans and analyze the market. He simply has no time, because hope dies last, and to carry it into eternity along with its own deposit is a holy cause.
Learn to conquer your internal enemies, risk correctly, and profits will not take long to wait!
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