LukeRachel posted: Fear and greed are harmful emotions in trading. The place where many traders are interrupted. If the trader is experienced in this place and is able to control emotions, there will be no obstacle for him to succeed.
Exactly, first of all, you have to control your emotions and participate in trading. If you trade out of greed and fear, the investment can be zero every time. Therefore, you have to manage the risk, eliminate the fear, and trade positively.
It would be unjustified to say that we don’t fear risking our money, no matter what level of trading we are at. When real money is involved, real emotions take part and it’s not easy to overcome them completely.
It’s common to be afraid of losing. But it shouldn’t keep you from taking risks that could be profitable for you. You need to take calculated risks that don’t involve emotions and that can be done only when you have some market experience.
Awesome article actually. I believe that fear is the most important part in trading which have to be overpassed. You can easily overpass the stages which include gaining knowledge, skills and experience, finding a broker and so on so forth, but whta will be really difficult for a new trader is to overpass levels of fear. The very first level new traders face after they join trading activity. They're afraid of depositing money because they are tend to suppose that they will be cheated. The second stage of fear is to be scared of moving fom demo to real account. The first deal drives you crazy. However, you have to overpass all the stages.
Forex trading psychology in my opinion is the most difficult thing actually. We can learn everything we want to learn, but it's almost impossible to set up our conscious correctly, everything because human beings are create to feel emotions. It's impossible to get rid of emotions at all, that's why it's getting harder and harder to handle our emotions. The matter here is to have an ability to distract yourself from bad thoughts and negative emotions. In his case I can advice meditation or some activities which will distract you from forex trading, mainly because you need to supress your emotions whil you're trading.
It would be wrong to say that you can overcome fear while trading because it’s a natural emotion that will come when you have put your money at risk. But you have to learn to control your emotions so that they don’t become an integral part of your trading decisions.
davemack posted: It would be wrong to say that you can overcome fear while trading because it’s a natural emotion that will come when you have put your money at risk. But you have to learn to control your emotions so that they don’t become an integral part of your trading decisions.It would be wrong to say that you can overcome fear while trading because it’s a natural emotion that will come when you have put your money at risk. But you have to learn to control your emotions so that they don’t become an integral part of your trading decisions.
Yes davemack! These emotions are part of trading and can't be just vanished. Traders should work on their emotions so that their trades are not affected.
The traders are either the most fearful in their first trades or become more fearful with time. The former is too scared to use their real money to trade. On the other hand, the latter are too excited to make money that they take big risks in the beginning and when it goes out of control, they are too scared to use more money.
I think we should really move over the thought that fear is the wrong thing when it comes to forex trading. But what if a trader is so fearless that he keeps taking unnecessary challenges just to lose money later? Don’t you think that being fearful would keep a trader from taking unnecessary risks and trading safely?
I would say fear is a tool that our brain uses to protect us from any sort of danger. And nowadays we feel that fear about almost everything we do: going to a new school, starting a new job or business. The fear of getting started with anything is because our brain senses the possibility of failure as a threat. And this fear helps us to stay grounded and make rational choices as and when required. Forex trading is no different. It involves money and speculation which comes with lots of risks and uncertainty. And having this fear of losing money is good whether you are rich or not. This fear will keep us from going overboard and keep us sane.
Great point! I struggled with anxiety when I first started, even though I didn't invest a lot of money initially, it felt like a lot to me at the time because we were living paycheck to paycheck. Losing some of it made me more fearful, but I managed to stick with it and turn things around without reaching the level of hatred or blaming others. Otherwise, I might not have made it.
Losses are always awe-inspiring for traders and it accumulates fear in traders that gradually turn into a psychological barrier in the way of trading. For so, there is no alternative to learning. Proper learning assists in discovering different ways to get rid of losses and bring advancement in knowledge.
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