Forex traders must be careful and understand that decisions taken in an emotional state can cause big harm because emotions make you flow with the intensity of the moment which may be harmful in the long run. So decisions must be taken very calmly and logically.
Emotions could impact trading process substantially, so each trader should know how to deal with them. The most common emotions are greed and fear, which appear depending on the direction of the price movement. In case if the price moves in favorable direction the greed could appear, making the trader either to close position too early to get the first profit or to hold the position too long hoping that the price will move more even if it is alredy far enough from the initial price. At the same time, if the price would move in the direction which is opposite to the trader`s initial bias, it owuld lead to fear of losing. In this case, trader could avoid closing the position hoping that it would reverse in the nearest time. All such mistakes are quite common among newbie traders. It happens this way because they focus exclusively on the technical part of trading process and forget about the emotions. To my mind, it is important to find own way to deal with the emotions in trading. There are many interesting articles about emotions that would help trader to understand all this better. Anyway, each trader will have to find his own approach, the solution that would be sutable for him. As for me, the best way to deal with emotions is to improve discipline. If hte trader has a plan and is disciplined enough to act in accordance with this plan, he would be able to succeed in trading.
When trading you need to be focused and almost regimental - take all emotion out of the transactions and just think as if you are buying and selling boxes.
Greed is the most dangerous emotion for trading. Most of the traders lose money just because of this greed. And there are s trader who is mistaken greed as hope. Greed is when you have no trading plan. You trade all day long. After a profitable trade, you open another trade in the hope of making money. But we should control our greed if we want to stay in the market and make profit for long. I am trading with Eurotrader broker that has over 100 trading instruments. You can choose your best from here.
Trading in forex can be really a roller coaster emotional drive as the market is very uncertain recently or may I say all the time since I joined. From my personal experience I can say it’s not possible to shut down your emotional part while trading as we are human. We can not just switch it down like robot. So we must embrace our emotion and try to work with it. A broker can also help you on this like mine Eurotrader. They make my trading experience so smooth and easy unlike other broker.
One certainly needs to remain in control while trading, but that is often not so easily achieved. Practise and routine certainly help though.
Emotion is a very dangerous thing in Forex trading so everybody should avoid it at least while they are in a trading mood. However, if you have less patience then you can join in FreshForex as their analysis always helps their trader.
Reason I keep advising folks to take breaks in between when things are getting tensed and the emotions are becoming high.
What's funny is, we can hardly tell how we would react to negatives in the market, especially when the market is going against us. This is where it becomes imperative to control our feelings, else we would gradually revenge trade and lose more.
While it is true that we cannot take away the emotions in the market, but we can always deaden our emotions to an extent to avoid shipwreck in the long. We really do not have a choice, we just have to learn to control them or take a break sometimes like someone suggested here.
