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Profit streak or loss streak. What's worse?

Lesley (LesleyLesley)
Aug 10 at 14:07
26 posts
The psychology of profit and the psychology of losses.
What will have a more destructive effect on further trade?
I believe that both scenarios will show equal pressure on the trader. In the case of losses, this can lead to depression, and in the case of gains, it will lead to overconfidence, which will further lead to losses.
HeavenLeighGill (HeavLeighGill26)
Aug 10 at 18:43
380 posts
I do think both have a big impact on the trader. Personally, I was more anxious, so I never really got into overconfidence, even when things go well. I think some of us are more prone to the depression while others tend to trade with their ego, so personality makes an impact here.
Suradi (FXOday)
Aug 11 at 00:57
400 posts
It will depend on our mindset, as human nature is greedy, want more and more, although already having a car then want to buy airplane, but actually don't want losing, in trading profit and loss is part and sometimes inevitable, but how to accept both as normal thing depending our mindset I think.
Marcel Durham (MarcellusLux)
Aug 15 at 15:56
191 posts
I agree with the opinion that the influence of these factors depends on temperament. But I also want to note that by analyzing your trading, regardless of the result, you can avoid such influence. An independent analysis will help to perceive any trade as an integral part of trading. Of course, I can also get excited and get a boost of confidence by consistently implementing a trading plan, but even with a profit streak, I try to look for opportunities to find flaws and improve.
Seb King (sebking1986)
Aug 17 at 10:55
538 posts
Innately a losing run will be more impactful as humans are evolved to be risk averse and so this will be a huge stressor to most. However winning streaks can be problematic both ways depending on if you are under or over confident. The overconfident trader takes the good run of variance is the norm and believes they are deserving of the profits they make and are therefore more impacted when it doesn't go their way. The under confident trader may constantly be waiting for the bubble to burst and so will subconsciously change the way they trade out of fear and impact the natural variance that way.
If you can't spot the liquidity then you are the liquidity.
WhiteWitcher
Aug 17 at 15:07
74 posts
Oh everything is not so clear. As a psychologist, I can say that it all depends on the temperament of a person. For someone, a profit streak will only inspire self-improvement, while for someone it will relax and he will lose his vigilance.

As a trader, I will say that it infuriates the same way. I am looking for a catch in the profit streak, and in the loss streak too. 😄😄😄
Lesley (LesleyLesley)
Aug 31 at 15:46
26 posts
WhiteWitcher posted:
Oh everything is not so clear. As a psychologist, I can say that it all depends on the temperament of a person. For someone, a profit streak will only inspire self-improvement, while for someone it will relax and he will lose his vigilance.

As a trader, I will say that it infuriates the same way. I am looking for a catch in the profit streak, and in the loss streak too. 😄😄😄

Is there a chance that after a long profit streak, a trader expects a loss and therefore subconsciously performs actions that will lead to this?
Lesley (LesleyLesley)
Aug 31 at 15:54
26 posts
MarcellusLux posted:
I agree with the opinion that the influence of these factors depends on temperament. But I also want to note that by analyzing your trading, regardless of the result, you can avoid such influence. An independent analysis will help to perceive any trade as an integral part of trading. Of course, I can also get excited and get a boost of confidence by consistently implementing a trading plan, but even with a profit streak, I try to look for opportunities to find flaws and improve.

Interesting way of thinking, and I've seen your posts where you profess to analyze mistakes and work with a trading plan. Do you think an excessive striving for perfection can backfire on you?
Marcel Durham (MarcellusLux)
Sep 02 at 12:49
191 posts
LesleyLesley posted:
MarcellusLux posted:
I agree with the opinion that the influence of these factors depends on temperament. But I also want to note that by analyzing your trading, regardless of the result, you can avoid such influence. An independent analysis will help to perceive any trade as an integral part of trading. Of course, I can also get excited and get a boost of confidence by consistently implementing a trading plan, but even with a profit streak, I try to look for opportunities to find flaws and improve.

Interesting way of thinking, and I've seen your posts where you profess to analyze mistakes and work with a trading plan. Do you think an excessive striving for perfection can backfire on you?

It certainly can, and did it. I'm really a big fan of post trading analysis and sometimes I find mistakes that were made because I made adjustments before. Such mistakes are probably the hardest to find and fix, because they appear where they are not expected.
Marcolis
Sep 04 at 09:26
195 posts
But it is sad to let you know that many traders don’t practice on demo account that keeps them lag behind.
WhiteWitcher
Sep 05 at 13:02
74 posts
LesleyLesley posted:
WhiteWitcher posted:
Oh everything is not so clear. As a psychologist, I can say that it all depends on the temperament of a person. For someone, a profit streak will only inspire self-improvement, while for someone it will relax and he will lose his vigilance.

As a trader, I will say that it infuriates the same way. I am looking for a catch in the profit streak, and in the loss streak too. 😄😄😄

Is there a chance that after a long profit streak, a trader expects a loss and therefore subconsciously performs actions that will lead to this?

Oh, it is possible if you are like that on your own. That is, everywhere you look for a catch. I am not looking for a catch, I am not building conspiracy theories. I just trade. So for me it is unlikely.
Nomocracy
Sep 06 at 09:55
26 posts
I’ll say that a profit streak can be worse psychologically, if a trader does not take forex professionally. Having a profit streak can put an amateur trader in a zone of confidence and happiness. But when this temporary streak is over, and they face losses after losses again, they become frustrated, and desperate to make profits. This leads to overtrading and revenge trading. When a trader has developed their trading psychology, they can make both profit and loss without harming any more market movement.
henrytrade
Sep 06 at 12:02
57 posts
Profit streaks, motivate me to work harder and earn more money.

lauraJohnson
Sep 08 at 07:34
34 posts
It varies from person to person as everyone as different mindset. But I would say that a profit streak is worse as traders usually get overconfident and end up losing huge amounts.
Vermilion1
Sep 08 at 11:22
19 posts
None are worse. Both profit and loss is a part of the journey. Mentally assigning either profit or loss as ‘worse’ than the other is most likely to affect our sentiments when planning a trade, or executing one. The best is to keep a balance, and balance means a state of nothingness. What I mean is, it is better to trade professionally without attaching emotions to the money you are trading. If you win you win, if you lose you lose, there’s no celebration and no mourning in both the cases. This will help you to keep your emotions from interfering.
Notandum
Sep 09 at 07:52
27 posts
A loss streak can be disheartening. After all, it represents a failure to achieve your goal.
But a profit streak can be just as dangerous. Remember, the goal is to make money, not to string together a streak of wins. So, which is worse? It depends on the trader’s perspective.
Cistern
Sep 09 at 09:31
22 posts
Profit streak is good until you get into overtrading due to greed and overconfidence. Losing streak can also lead to over trading as you are desperate for a winning trade. Or it will make you fearful to take up any trade and will result in stress. Emotional control is very much needed to deal with both situations. That is why we always talk about the importance of understanding the concept of trading psychology.
tyson_learner
Sep 12 at 05:14
39 posts
It varies because every individual has their own different mindset. For me personally, loss streaks are worse. It does not only take away my money but my self confidence in my skills also falls with every loss.
hendrickscock
Sep 13 at 06:40
26 posts
I agree with OP. We should not let our wins or losses get into our heads while trading. Losing streak will obviously make us stressed and doubt ourselves and winning streak will make us greedy and overconfident. Both are equally dangerous for a trader. And we must be able to trade with a neutral mindset in any situation.
Raven1209
Oct 04 at 11:31
10 posts
Both scenarios profit and loss are detrimental to an unprepared trader.
And not only for the trader. For any person.
In the case of profits, this scenario may not be as fast as in the case of losses.

Psychology is a delicate thing. Everyone has a different mind.

In order to be resilient to this, I believe you need to learn how to invest a little bit, moving from less to more. But by no means the other way around. Otherwise, there will be a disastrous scenario for most unprepared investors/traders.

Investing little by little will teach you to put up with losses, and accept profits as something normal and correct.
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