The Crazy You!!!….Whom I am pertaining no one but you! or I mean us…All of us….. To be able to understand how things works you must understand how you work. Yah! Confusing right.. Let’s make this easy have ever wonder why someone in a forex forum post his system claiming that his sytem works then suddenly you used it trade with it then fail with it losing all of your capital cursing the trader who post his system just trying to help you out. Remember what I said a while a ago to be able to understand how things works you must understand YOURSELF. The principle behind trading is not merely having a system or a principle or maybe a theory it should be well aligned with your PERSONALITY. A good system needs a great pilot. The Forex world is traded mostly by individuals who have different personality thus Trading Psychology is one of the aspect that we need to learn. We should never fight the market, what we need to do is just to follow the market.
One of the most destructive and deadliest sins in this world is GREED. I know it’s very familiar for us to establish this because of our human nature to have everything. Greed sometimes comes out when we never plan to exit in a particular level in the market. We know we are right so we squeezed the market to its very single drop hence we forgot that market tends to change directions from BUYING TO SELLING or from SELLING TO BUYING.
I still remember the first time I traded the market and I have won… telling to myself if I could just triple my account in a month I could by my dream car and dream house and everything in this world. Hence I opened an account and funded it with real money I have save for too long but who would have taught when GREED knocks in your door you could never resist. With just a single trade using x500 leverage everything melts like an ice……….T_T The things you need to fight greed is to have a plan exit somewhat a target goal for the day and a limit of trades you would do to get those target pips. Never ever used the maximum leverage especially if you’re a newbie, actually x25 or higher is considered overleveraged.
Now let’s know about FEAR. I heard you !! It’s actually inside you. Everyone has fear but what really is Fear? It is an emotion or a perception that something might happen yet it is not yet occurring in short an ILLUSION, losing money can make traders skip on a perfectly valid trade. It might also make traders take a small loss on a trade, to then see it turn around and give profit when all the time you were taking the correct steps of entering a stop loss which was never taken out. Honestly Fear can be prevented if you only plan your trades and trade what you see not what you feel.
As one of the great saying “Be fearful when everyone is greedy. Be greedy when everyone is fearful” just know when the right time. It takes practice and practice and practice and tons of practice. In the world of forex no trader will ever be able to avoid this emotions that hindering us from being a successful trader. Some trader would experience this emotions regularly and thus if not avoided on how to control ones emotion can be very destructive and will lead to frustration and failure.
For trades who are still in the process of learning and for those newbie I recommend that you start in DEMO trading for about 3 month or so just to be familiarized with the platform. The secret to hasten your learning especially in Trading psychology mastering to control your emotion is to open a LIVE account and start trading with the smallest possible size there is so that you would experience early on who does real trading feels like.
-“Everything was been given and been prepared yet only you is the missing part on the Success Recipe”
