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Psychology and Forex trading
Psychology is often is the cause of significant financial losses while trading in Forex.
For all the price movements in the market are real people, many of them, they all share basic human emotions and needs, most of them acting stereotypical and predictable, panic failures, too early to rejoice in the achievements. You should try to understand the psychology of the "crowd" consisting of Your fellow traders, and to pay its "laws" to their advantage.
It is equally important to be able to control their own emotions, arising at critical moments in Your trading practices. After all, the main motive for Your activity on the Forex is precisely the pursuit of profit. People who are prone to greed and excitement, often unnecessarily at risk when conducting transactions, exceeding reasonable limits of their allowable amount. At the other extreme, excessive caution, the very small number of transactions and, therefore, as small profit margins. Plan your trade, determining in advance the point of stop orders. Do not pursue changes drastically in price, unnecessarily increasing the size of the position. Try to immediately when opening a position to determine its trading purpose.Already fix the profit before the extend a winning position.
In any case, don't feel the hope that poorly runs the deal now will turn into profitable. The best time to stop, analyze the cause of the failure and "ride" the trend has changed. The delay could face the fact that Your entire Deposit will be "merged". Although "hope boys fed, these expectations should be based on real ownership of the situation and should not be excessive.
Perhaps if You're overly emotional, You can use the method of trading on a "open and forget". Although the word "forgot" just means that You will not be constantly "jerk", watching an open transaction. On completion of any transaction, You just have to analyze it, assessing the causes and consequences.
Fears of possible losses is a vain fear. You should be aware that losses during actual operation in the market is inevitable. Your task is to ensure that profits exceed losses. Do not hang your nose after each failed transaction, do not generate a "inferiority complex". Better try to use the situation.
Train your intuition, check it out. In fact, all situations in the market again. Try to gain as much experience in the trade using a demo account. This will help You to buy confident trading skills and to come to terms with the failures that occur in a trader's life.
Psychology is amazing and the theory of candlestick analysis. Patterns of candlesticks very clearly and vividly reflect the "element" of the market. Be sure to check out this theory.
Try to distinguish patterns that occur in price movements. In the end, these patterns have a psychological nature. Full market chaos develops in surprising and interesting mosaic of the hopes and fears of millions of people who decided to "enter the market".
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| Category: Forex | Added by: (29.10.2017)
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| Views: 456
| Rating: 0.0/0 |
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