How important is trading psychology to you?

Just out of curiousity, I was wondering what everyones opinion is regarding the aspects of trading psychology are.

  • Staying disciplined
  • Sticking with stop losses
  • Not cutting profits short
  • Not entering trades on impulse
  • Overall sticking to your plan

This seems to be a big topic so I figured this would be a good discussion.

the psychology of trading is huge. Until you figure out how to control your greed and fear, and gain confidence in your methods you can never be successful in trading

I would check out, “Trading In The Zone” by Mark Douglas.

“Trading in the Zone” is an excellent book I highly suggest it to any new trader. Not just to forex, but to any trading vehicle like stocks, options, and futures

Hi,

I am a newbie too.

Currently I am reading “Trade your way to financial freedom”.

I nearly had my hands on “Trading in the Zone”. I read the back cover - it is probably the best book available on that subject. :slight_smile:

I will have to buy it soon and study it for myself.

Regards, Tymen Wortel, Perth, Western Australia.

This is true.
It really requires in trading to be discplined.
not be greedy.
If you have made some profit… grab it and cover it, dont be greedy and wait for me.
If you have made loss. dont just wait that market would reverse… Accept the loss. and trade again in right trend.
Make a money management plan.
Make a Schedule of when to trade…and focus on few pair of currencies

I’ve been live trading for two weeks now, and I’ve already seen my ups and downs. I didn’t care if things could go south when I was demo-ing … but now every move is questioned by myself.

I am hedging currecy pairs with a high swap. I started with a high note and increased my account by 23% the first week. I felt a little sad because if my broker had gotten my money in my account a little faster, I would have doubled that increase, but I was still excited about the increase. This second week has been hell … I’ve had a drawdown of over 30%. I didn’t have problems during my demo-ing, but now that actual money is on the line, my confidence is shaken. I watched as my pairs were not corellating well, and my draw down was getting worse daily.

Things are already showing signs of turning around, so my confidence is building onace again. I am hoping that when (notice I said WHEN) I get through this minor hiccup in the market, my confidence will increase.

My wife can tell how my account is going just by watching my stress levels. I am hoping to learn to hide that stress, and eventually remove it.

Steve, you should have opened account with stifx.
your deposit would have been done quick immidiately.
they do very quick deposit and withdrawal too.

psychology is hugely important in trading, understanding yourself, your ticks and your behavioural patterns when overcoming losses and negative attitudes is essential, in my experience, for surviving as a trader. It can take time for this to become realised however.

I would say it is THE MOST IMPORTANT THING in trading.
If you don’t have the right mindset for profession gambling then you have next to no chance of success!:33:

Psychology is key and you need to stick with your strategy. Trading is emotionless and you need to set your S/L and T/P BEFORE you enter the trade and just let it go form there, do not adjust them. Before you execute the trade figure out what you are willing to accept as a profit and loss, then enter them and forget about it. Should you be tempted to adjust, especially the S/L you are most likely to lose.

The one who blinks firt is the one who loses.

Well then you lost. If you would not have blinked you would and seen you missed the s in first. What do I win:cool:

By the way, there is another book also called “Trading in The Zone” by Ari Kiev. It is much more complete, well it is for advanced traders.

Regards.

So far, in all my manual demo trading this year, it’s been me breaking my own rules with new justifications that make up the bulk of the losses.

The Robots I’ve tried have no ultimate stability. I see folks working commission rebates systems where the multitude of trades make for a small profit. It works. I see myself take $100s if not $1000s off the table only to give it all back.

I’m working on a hybrid concept where the EA makes the trade each morning before I get up and then I kill the trade if the Mark 1 eyeball pattern sensor sees what the wide stop robot cannot. The EA may trade 50 days in a row for profit and then wipe the account when I can plainly see it’s missed and the trade is possibly falling apart and needs a close stop. It’s a Work in progress.

It’s much harder for me emotionally to get out of a trade than get in, alas. I probably do gamble too much. But, let’s say I didn’t place the trade, but the EA did, I somehow find it much easier to bail out. That’s psychology, right?

I do have to disagree slightly with the gambling idea, but not the professional mindset. In Forex the odds are not fixed or rigged , really, other than the spread. So, getting stopped out on a Sunday is my fault, however. Nor do we have to deal with bluff, except bluffing ourselves with overconfidence. We do have to ante up. And, we do need to know when to fold, or hold, and when not to play. So, it is just a bit above gambling, maybe. :slight_smile:

Try to make it less complicated.

Could you be a little more helpful?

Yeah, make it more easier. Remember the KISS method.

Easier on what? My psychology? I’m not sure what you are driving at? A trading system? What can I apply with these comments, do you think? What do you apply to get simplicity of profit?

I only trade if I know I have a high probability of winning.
Psychology does not come into my trading at all.
If I alter my system based on my feelings that would be silly and would change a winning system into a loser.

I am not saying I am perfect. I will close a trade based on it not fitting my system, news, etc. But it is not fear of losing, it is just common sense.

I think if you are trading with fear you are probably risking too much and are not confident in your system and you will lose?
Although if your system is flawed, you should have fear :slight_smile:

I think if you are emotional(fearful) you shouldn’t trade until you are confident you can be profitable.
I get confident in a system by demoing it for a long time.
If you demo a system for 6 months and get a high return and a low Draw-Down and it all looks good, you should be fairly confident it will be a winner.

I am not saying it is easy to find a winning system. Just that you have to know the system inside out and be confident in its performance and know what danger signs to look for in the market for that particular system.

& I don’t gamble. Gambling is for suckers.