Whether you’re a seasoned forex trader or simply a newbie, I’m sure you’ve already come across a couple of generalizations about trading.
But be warned! Some can have some truth, but these three are nothing but myths.
Listed below are three of them:
1. “Try often enough and pretty soon you’ll succeed.”
Perhaps we’ve got Disney responsible for having this fairytale mindset, considering that whoever watches the market 24/7, takes essentially the most trades, and provides up his entire social life, might be rewarded with a pleased ending.
Sorry to burst your bubble, however the forex market doesn’t give a cat’s litter about your efforts.
You don’t must pull the trigger on every setup you see or watch the charts all day errday to make a living out of foreign currency trading. Traders gotta have a life too, ya know.
To be consistently profitable in foreign currency trading, you want to hone your abilities and develop your skills.
This implies working on things which you could control, so stop depending on good karma to reward you with pips!
2. “So long as I even have discipline, I’m protected.”
Don’t get me improper, discipline is most definitely mandatory to being successful in foreign currency trading but there are still aspects that would trip up your trades and switch them into losses.
It could possibly be that you just didn’t spend time to practice on demo first or backtest your forex strategies before going live. Or your trades could’ve been affected by black swan events or other unlucky market moves that a trader can’t really prepare for.
Either way, traders can still be disciplined AND lose their trades and even accounts.
It’s all a part of the sport!
3. A trader’s primary enemy is his emotions.”
Traders have been told repeatedly to maintain their emotions in check.
Being vulnerable to your emotions can have negative repercussions in trading, as your concentration and decision-making process can get skewed.
But give it some thought for a second. When do you are feeling most stressed? Is it during those times once you’re trading poorly?
For those who answered “Yes!” to the second query, then congratulations, you might be a traditional human being.
Emotional stress is a natural results of poor trading performance. This happens when traders fail to administer risk properly or trade with none objective edge within the markets.
What results afterward is a vicious cycle where one’s negative emotions can damage trading performance.
All the time do not forget that trading is a performance field, where success is a results of a mixture of talents and skills. And as with discipline, control over your emotions is a vital factor but it surely’s not the one ingredient to success.
Mastering trading psychology simply dictates how consistent you might be with applying your talents and skills, but it surely cannot replace those aspects.