No, confidence means that you [B]think[/B] you are right. World of a difference
I mostly refer to that reaction - and emotion - as arrogance, rather than confidence. Confidence isn’t necessarily a bad thing, as long as it can be backed up by real skill. That is why it’s important for a trader to be prone to self-reflection leading to self-awareness. One should know what they [B]can’t[/B] do, but also what they [B]can[/B] do and have a realistic sense of their own self-worth.
It is only normal for traders to become afraid when they start to lose money. What happens next is that they’ll start having impaired judgment. Since It cannot be denied, You have to have the attitude that if a trade loses, you can handle it without any problem and come back to do the next trade. You can’t let a losing trade get to you emotionally otherwise you’ll stop trading.
The most important thing in trading is to recognize when you have the correct psychology for placing a trade. If you lose a trade you must clear your mind and then place another order.
What would you define as the correct psychology?
Emotions in trading is normal. You shouldn’t be afraid of or ashamed of your emotions, only robots trade without emotions, which are the future of trading. But emotions should be controlled, if you’re hurting yourself or others, by breaking thing or any other way, then you should definately lower the trading sum, in order to take the emotional edge off.
As much as I don’t want to admit it, but sometimes when things are going too badly or too well I do succumb to emotions and make mistakes… well, I guess I still have lessons to learn.)
Emotions had big impact on our psychology and mood that will effect on trading. Profit and loss can change our mood . Both are interrelated. We are happy with profit but should accept normal loss with open heart. With unexpected loss you should review your plan and strategy , So that it will not give you harm again and again.
Emotional response to the outcome of your trades is quite normal but it shouldn’t be exaggerated at all. This is why you should trade with a forex trading strategy. This way you are more conditioned by a preset trading plan and a lesser likelihood of you flaying out emotionally in response to market movement.
You are right! Every normal human has emotional reactions when it is profitable and especially when a loss is coming. Experience in trading will make you more dispassionate.
Sometimes it happens to me! The problem was, I wanted to recover my losing trades so quickly by using over-lots size! On the other hand, after making healthy TP position I opened another new trade with the same direction! By the way, I am always positive on my live trading mistakes, and I am learning from my mistakes!
I’ve done that too and it was not a good decision. Revenge-trading is generally a poor idea and has to be avoided when possible.
Absolutely, the result of revenge trading is ultimately death of trading account!
Frankly, in my initial stage of trading I was too emotional, then expected 100% success as a result, I lost my momentum to easily! But now I know the reality of Forex very well, and I feel till now I have to work more on this critical sector!
As others have mentioned, I think everyone is emotionally affected by their P&L. The real question is how do you deal with these emotions? I believe that having a solid trading plan and sticking to it is the first defense against our emotions. This is of course easier said than done. One idea that I got from a YouTube video is to give yourself a point system test. You give yourself 1 point for every time you follow your trading plan during a trade and subtract 1 point for when you do not. Do this until you reach 100 points. At that that point, your P&L should reflect an improvement.
Emotions had their impact on trading , I now try to avoid emotions because always see motions is not a good routine. One should see what market is working . He has to decide then what will be good for this situation . Yes when you over come on your emotions you will be more good in trading
As a matter of fact we feel our loss much emotionally . In profit we had an urge to get more but loss effect on our nerves badly specially when we are new trader. A mature trader had control on emotions he understands reality of loss and profit , he feels less effects.
This is why i always try to calm down before i take trading decisions. I take my emotions in account bu i don’t want my decisions to be biased by feelings. Well i know it is easy to say for me right now, i’m still trading demo. When trading live emotions will certainly get more intense. Therfore i try to take demo trading already as serious as possible.
You are absolutely right! It’s a human nature! But the thing is, pro traders recover their pips so quickly and they don’t lose their hope at all! Since, they can identify good trading opportunities so quickly!
Any human will certainly be affected by it and there is absolutely no rocket science thing with it. I believe we are meant to get affected by profits and losses, it must be handled. We got to make sure we don’t take emotions into consideration when working. If we do that then we will be able to gain very well and help our self with making money too, so we have to work on that note.