Wednesday December 28, 2016 - 16:52:59 GMT
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Trade what you see not what you believe
Trading the forex industry is very tricky since it involves an extreme test of the human emotions. Most of the rookie traders in the financial industry fail to make money in the forex market because they don’t know how to trade the market properly. They simply execute their trade in the market based on their emotions. However there some new traders who have some decent knowledge about the financial market yet they fail to achieve success in forex trading since they lose their trading discipline in the hands of emotions after incurring few consecutive losses in the market.
Before you start your trading career in the real market make sure that you develop a strong basic foundation about the forex market. Most of the retail traders in the forex industry jump into financial instrument trading without knowing too much about the forex market. But if you don’t the basics of the forex market then you will never get a chance to become professional traders. To be honest, people severely suffers to make a profit in the market even after having a strong foundation. They simply forget their lesson about the forex market and start trading with their emotions. In the next section of the article, we will discuss how to trade the market with logical reasons and keep our emotions aside.
Stop taking a wild guess in the market: There are many rookie traders in the financial industry who executes their trade based on their wild guess. It’s true that sometimes they will become lucky and earn a good amount by trading but in the long run, they will wipe out their whole trading account. So if you truly want to become an expert forex trader then you need to learn lots of stuff about the forex market. Once you learn them try to implement your knowledge in the demo account. Consider your demo account as real account and try to execute high probability trades in the market.
Don’t spend too much time in trading :Most of the professional traders spend only two-three hours in trading in every single day .They know that trading is not about looking to the chart all day long’s a professional trader they try to filter the best possible trade in the market and execute them with logical reasons. On the contrary, all of the rookie traders always get stuck with their trading account until they blow up their whole deposit. You are bound to make mistakes in the forex market if you spend too much time on the trading screen. Human psychology is made in such a way that it will always try to make a profit. So the rookie trader will have a hard time to control their emotions if they look at the trading chart all day long’s make sure that you are glued to your trading chart since it will make you emotional which will ultimately force you to execute low probability trade in the market. You should be trading the chart not what you believe.
Build strong control over your emotions: Those who are trading the forex market for a long period of time have developed a strong trading discipline and they execute what they see in the chart not what they believe. They know very precisely that if the trade what they believe then they will incur huge losses in the market. To be honest the chart always will have a different opinion on your emotions.
Let’s see how deceptive the emotion can be!
Figure: AUDUSD daily chart
If you consider the dark shaded region then you will always be thinking that the price will go down. Even most of the rookie traders will continuously execute short orders in the market if it goes to significant high. But in reality, the price went up more than expected and you can clearly see it from the chart. So think again whether you take your trading decision on your imagination or you will execute your order in the market based on your technical and fundamental analysis.
If you think that you’re losing control in the market then you should do two things. First of all, you should stop you PC and take a deep breath. After that, you should go out for a walk without any smart device. To be precise you should disconnect yourself from the trading terminal at least for one hour. Most the traders become emotional after incurring some few losses in the market and execute low probability trades based on their emotions. But always remember that you will never succeed in the forex industry if you trade with emotions. Always try to execute your orders based on rational decisions.
Summary: Trading can be extremely difficult if you’re relatively new in this industry. Most of the professional trader who is trading the financial instrument for a long period of time have undergone severe learning stage and they always know the importance of rational decision in the market. It’s true that sometimes the professional traders also become emotional but when they realize that they are getting emotional they always disconnect themselves from their trading room. Make sure that you are always executing your orders in the market by following strict trading strategy. Never ever take any single trade in the market based on your assumptions. Another key thing that you should always remember is the implementation of proper risk management factors. If you don’t follow proper money management then even after executing your order very precise you will make money in this industry. So, proper money management is a must for every professional trader.
Autor: Dwayne Buzzell – Look at my forex website
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