Good one bro!
This was quite a read. I have to add that having a multiple account is a good idea and allowing you to be ease when making a decision, and also with multiple broker, you can pick few that suit to your trading styles, allowing you to be more comfortable in trading with that broker.
The original poster is right that emotional influences on trade decisions are going to be negative. But like most writers, he looks only at the immediate emotional waves of feeling at the moment the trade is being opened and decisions are being made as to how to manage it.
In fact, emotion plays a fundamental part in traders’ decision-making long before this point. Most new traders start with fear as their most powerful emotion. There are two key fears - fear of failure and fear of losing money. These make them believe that the shorter the time they are in the markets the less danger they face. These are logical conclusions but come from emotional perceptions of trading.
The result is new traders are driven to trade on short time-frames and to seek opportunities to get in at market reversals for quick dramatic wins.
The result from this is a failure rate of 90%.
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I believe that having forex knowledge, understanding the market carefully and trading without emotions can always lead to fruitful results.
In order to get better at decision making while trading, it is very important for the traders to avoid emotional and psychological influence while making trades. Decisions and trades should always be driven by rationale and strategies. Also, acquiring a good knowledge of chart patterns, stop-loss orders, indicators and money and risk management skills along with discipline and consistency helps more than anything to ace in the field of trading.
Trading is an art, and you can only excel at it if you understand all there is to know about it. Here is how you can keep your mind relaxed for a strenuous trading session:
- Meditation
- Focusing on trading process and not results
- Risking what you can REALLY afford to lose
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Great post! Thank you for posting this guide!! This guide will surely help newbies make better decisions. This guide will help other traders stay on track too.
Three trading hacks that, in my opinion, can help you succeed are:
-Consistency
-Begin with small amount
-Constant performance evaluation
Forex trading is definitely an art form that must be mastered. To be a great Forex trader, the trader must have the internal ability to regulate both their thinking and their actions. It also implies that the trader must have honed their chart reading and market analysis abilities to the point where they are confident in their ability to read the market.
Well written. I totally agree with you. Forex trading is a psychological game and emotion management is very important to make profitable trades.
I agree, market planning is very crucial when it comes to trading because they help us to get clarity about the market and our moves over it.
- Make a trading plan and stick to it.
- Always use stop loss.
- Use leverage wisely.
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- Consistency
- Continue to evaluate performance on daily basis
- Start with small amount
Plan when you will need to make a decision before you plan how you will make it. Don’t get into a decision-making frame of mind before you need to make that decision - this will only lead to tinkering.
Learn well before trading, keep emotions aside and do lots and lots of research before making any decision don’t just rely on luck.
1.Track your trading performance
2. Set a stop-loss for every trade. Otherwise, failure is almost certain.
3. Keep your emotions separate from trading.
Manage your Risk Exposure
Time Management Skills
Discipline
Hey buddy, Do you set a stop loss for every trade?
I think managing our emotions is one of the hardest parts when it comes to trading. It is not easy to think logically unless you train your mind to do so as a trader. You have to keep doing it forcefully until your brain gets used to rational thinking. Because our brain is wired that way. And that is not an ideal approach when you are a trader in the forex market.
It seems to me that in trading you should be more careful and attentive. Trading is an industry that needs stability and understanding of the situation, without “smart” solutions.