Many new traders have limited experience using money. What I mean is they earn it and they spend it, first on the things they need and what’s left on the things they want. So most people are not prepared to lose money - not many people make such a catastrophic mistake in a job that they lose their job; not many people go to a shop and buy food and then find at home their bags are empty.
The new trader fears loss. This leads them to fear being in the market, so the shorter the time they are in the market, the less fear they feel. So they trade shorter and shorter time-frames and avoid holding over-night and they avoid putting enough money into their accounts even if they could afford it, which means its difficult to hold a trade over-night anyway.
In trading, psychology and risk management plays a vital role. As a trader, you should be prepared for the situations where you might have to face adversities. You have to be patient, confident and you should know how much risk you can take. Additionally, it is very important that you know your strategy well and have good knowledge about the market.
Never had one since trading manually. Used to trade using an EA which didn’t have a stop loss and that was horrid. Use a stop loss and this won’t be an issue or rarely will.
In a highly liquid and volatile market like this, it really gets difficult for traders to manage emotions like fear, greed and sadness. While fear and greed and the most dominant emotions, they often peak when the market peaks are overwhelming or the market hits the bottom. The best market strategy is to avoid chasing sentiments and focus on stable money and risk management strategies. Traders should always remember that the key to winning and surviving in this field is hard work and persistence which comes after passage of time and experience.
Losses really make your perception negative towards trading but you have to be strong. Losses are the mistakes that teach you how to trade better. Without accepting losses you can never become a consistent trader. You need to control your emotions and start trading on a fresh note instead of quitting & getting disappointed.
I think the only way to manage your emotions while trading is getting used to them. Actually you should never suppress your emotions as they tend to blow up like a volcano if you try ignoring them. It can be fear, sadness, happiness, excitement or anything. You should just accept and feel that emotion just like you would in your normal life. But always make sure that you are in control of your emotions and not the other way round. You should know when to stop feeling the happiness or excitement of a win and get your focus back. Your brain might trick you to keep trading in such situations but what makes a wise trader is the ability to decide when to stop trading.
One thing I want to know how to handle.
When you get in a trade, it start with right way with little profit, but sudden gone in 1 sec.
Especially you use Hour chart to trade, when Hour chart give you signal to buy/sell.
Actually it was already go a direction over 35+mins.
Well, when you get it according to the trade rules, maybe over 15+mins reversely direction
but finally, it goes as the long term trend is correct.
The higher time frame to use on main trade, the more on draw down and time on risk.
Well, it is meaningless, if you see a Hour chart to trade but close the order within 3-10 mins.
What is the balance way?
If a Hour chart give you a Buy Signal, wait for it turn down and wait for 5mins Chart look bull again?
Or you need to find out some MA with certain True Range, maybe under 1 ATR for entry.
If 1 bar already strong BULL 6 ATR, don’t chase it.
Are you saying trades don’t always go in the direction you expect straight away even if the trend on the hourly is good, then it eventually goes the way you expect?
If that is the case, look at the 5 minute chart, wait for a pull back close to the last place that price stagnated, then place your ‘trade’. It won’t win every time, but it’s how I try to find good entries whilst day trading. It’s completely normal for price to go against you short term and then move back in the right direction. If it’s stopping you out, then your stops are too tight and/or your position too large. If you can get better entries, you can tighten/increase size. But get used to winning first.
Take today example, Hour chart or even Day chart sure is downtrend.
but this pin bar kick you out.
Another psychology is how to let the profit run.
There may be some bully signal on some indicator to show, how to let profit runs.
Maybe you have already success profitable on 6+bars, but finally answer was 46 bars sth.
This really hurt in mind, find the right way to too early to go out.
But the price had been that high about an hour ago, you’ve got to expect that it can go as high as the last couple of hours when in a down trend. That’s probably aligned with some news, and did the usual whipsaw.
You can’t expect to put a trade on and it take off every time. Clearly the EUR is down and all the news releases are worse than expected. Personally I wouldn’t have put a stop loss on because I always get stopped out and then it goes in the right direction, and that is very obviously the way that market is going today. But if you do put one one, you have to give it plenty of room and that means above the last couple of highs.
