How to beat the Psychology of trading

I am very aware that trading can become a drug and can cause addictive behavior, but I want to share with you some tips to combat becoming a “market head” lol

Tip 1: Find other things to do that don’t involve trading (Sports, Working out, Wacth tv, and something that may be the most important SLEEP!!)

Tip2: Move to higher time frames (This will move your screen time to a minimum. You will not have to be at the charts for hours on in trying to figure out which direction the market is headed. Live your life because the market will live its life with you or without you.

Tip 3: “Trade what you see” ( I say this a lot because it is TRUE . I find that many novice traders are jumping into the market because the news was good so they anticipate the market to go a certain direction or they have a set theory in their mind about the market. Regardless of what the price movement is suggesting they continue believing that their theory of the market. So if you fall into this category relax,breathe, and learn the price action signals to look for so you can eliminate all the guess work. Let price be your guide!

Tip4: Follow tips 1 through 3 add in learn how to be a gracious loser. Because you will lose in forex. That just part of the business. Don’t beat yourself up.

I have found the best thing I can do for my trades is to just close my computer to and go to bed. My trades more than likely get activated and the move into profit, and I skip all the stress of when I’m in the red for a while.

Set your trade entry order,stop order and limit order, and don’t think twice about your plan. Fear not, because you know what you are doing when trading the Forex Market. You did your research and your due diligence, so place you trade with confidence. Take your profit and smile. Smiling relieves Forex stress, and makes a Forex Trader feel good.

Risking a smaller % will let you breathe easy. When you breathe easy, you can think clearly. When you can think clearly, psychology has been beaten. It’s like demo trading. When you know what you’re doing, you can risk more. At beginning stages, I think this is the best way to combat psychology.

a lot of newbies don’t and will never understand the importance of psychology UNLESS… your brother,uncle, best friend, or dad is a trader and makes a lot of money trading
I was once there and I kept hearing “risk less, risk less, risk less, 2% risk”… i thought to myself “why are these fat cats trying to minimize my income” but hey, its a process.
It’s going to require you to change your perception of you even putting on a trade, [B]"how much am I willing to risk on this trade just in case it goes against me " [/B]

Hi Mr. Pip,

In my view these are the points which must be kept in mind:

Avoid emotional trading:- when we lose money we become more emotional and invest more money in order to get the lost money back. But that is the time we have to be more careful and should act as a disciplined forex trader to avoid such type of emotional trading.

Clear your goal: Forex trading can be a hobby or it can provide you a supplementary income.

Accept reality: Most of the traders expect higher returns in a couple of months in their account but it’s not true. Even professionals can’t make such returns in such period.

Get to know forex market: Before making an investment try to understand every single aspect of forex market.

Market psychology: Try to understand market psychology and reasons behind how it is reacting that way. This will help you to trade profitably in a long run.

Try demo account: Before making real investment, practice your trading skills for at least 3-4 months. It’s not a waste of time but it will help you to Improve your skills.

About psychology trading I think will better if any trader always keep discipline with low risk trading, control decision and always obey rules money management, if only using small capital hence will better as trader use smallest lot size and don’t increasing use bigger lot size if not yet reached certain number capital

When you have a good trading plan and you follow that plan without any involvement of emotions, then you can control your trading psychology with perfection.