A man stepped on a thin track trade in the forex market, it is facing a lot of problems. Often, it is lack of understanding of the subtleties of the work puts an end to the forex trade further.
At the same time, most often, traders blame for the defeat solely working schemes. But in addition to the schemes self-control plays an important role.
Therefore, Forex psychology is one of the most important factors that have a direct impact on trading results. Even experienced traders are susceptible to emotions and change their style of trading generated that often ends with financial failures.
Any experienced trader can tell you, "when playing on forex, you are competing with the sharpest minds in the world, each of whom wants to fuck and you and profit, so it is only to prevent the probability of loss, and may be considered a game lost."
One of the most destructive emotions is considered a trader ...
…Fear.
Before you understand the intricacies of the impact of fear on the trader, you need to clearly understand the causes, nature and impact on the human body as a whole.
Fear - is a basic emotion that entered into the human psyche at birth.
Initially, the fear of appearing only in case of danger. With the acquisition of experience, fear could appear in anticipation of danger, or when its prediction.
Depending on the genetic predisposition, any fear is the body's function «fright or fight».
Fright or fight. The instinct of self-preservation.
In everyday life or in situations of extreme stress, a person have to overcome the dangers and difficulties that may threaten his life, well-being or health. This causes fear. Fear is an unpleasant sticky emotion, but it is fear that helps get rid of or avoid the danger.
Fright or fight (in translation from English means "to flee or fight") - psychophysical condition when activated by all the resources of the body. Regardless of the choice of "run" or "fight", the body activates the maximum.
In case of large stress, some people are beginning to actively work in order to resist because of stress. Others, on the contrary, fall into a stupor and watch how everything rolls down. In practice, it looks like this: the dismissal, with a predominance of people fight will beg the chief to leave them at work, people with a predominance of the fright to slam the door and leave.
Most important to understand the factors that influence the independence of the fight or fright, fear of causing any ill-considered actions that could severely harm.
What fears may disturb the trader, and how to deal with them?
Fear of the unknown.
At each stage of development, the traders concerned are different fears. So, just come to the currency market was overcome fear of the unknown.
Fear of the unknown - one of the most common and most dangerous fear. On the level of psycho-physical body does not know how to respond to the alleged source of danger. The reactions of fright and fight taking place in the body is variable and chaotic. At the moment, it is one of the most devastating fears. Fear of the unknown is often described in the literature and cinema. Various meetings with the hoax and extraterrestrial beings demonstrate basic reaction of the human psyche in the fear of the unknown.
In real life, fear of the unknown can be caused by a lack of experience in a new field of activity. Often, a newcomer to the forex does not know about currency trading features. Newbie can not always cope with the terminal interface. All this can have fatal consequences in mind thoughtless foreign exchange transactions, which in 99% of cases lead to loss of capital.
The most effective way to overcome fear of the unknown, will read this and other blogs, the use of a demo account. Perhaps a visit to the free and paid conferences. This approach will allow to learn the basics and features, and no longer feel like a stranger in the currency forex trading.
After mastering the basics of the terminal, as well as the slightest understanding of the device market, the trader there is a lot more wide variety of fears. For example, fear of loss of capital.
Fear of loss of capital. Negative experiences.
Fear of loss of capital has almost all mid-level traders, it is not as damaging as the fear of the unknown, but it is largely inhibits profit for the trader.
Ways occurrence of fear only two subspecies:
1) negative experience;
2) Handling large amounts.
We will try to consider each of the ways of occurrence, as well as ways to overcome this fear. Note: in spite of the psychological approach, all materials provided in this article do not guarantee one hundred percent freedom from fear. They only help to understand the reasons for its occurrence. As you know, the recognition of fear - the first step to getting rid of it.
Negative experiences. The negative experience occurs in everyone who lost their first deposit.
Thus, the operations performed by an inexperienced trader, and the subsequent negative result - the loss of the first deposit (especially if your first deposit represented an impressive amount) is stored as a negative experience trading forex. According to statistics, 97% of traders lose their first deposit.
When such an experience can occur a few things:
1) The trader will cease to trade on the stock exchange at all and would say that trading in Forex is another internet hoax;
2) Fear paralyzes the trader, and he will not be able in the future to adequately assess the performance scheme that would lead to further losses;
3) Fear pushes to act and to enter into mutually exclusive transaction that leads to even faster collapse.
Even if the negative experience does not lead to complete ruin, his very presence is almost always a negative impact on the further fate of the trader. There are many cases when a trader, having the insider information, as well as a full trading scheme, which will provide him with a considerable gain, would not take the risk, as it has a negative experience, and fear of loss of capital.
The only way to get rid of the negative experience is to have a positive experience. Therefore, in no case can not throw the trade. To purchase a positive experience, it is possible to analyze the activity of other traders, as well as view the dynamics of the market in previous years. Success stories can also motivate for further trade and to overcome the negative impact of the experience on the impact of trade.
Handling large amounts. Handling large amounts can cause fear no worse than others, the above-mentioned reasons. However, in this case should not be confused with fear of loss of capital ordinary caution. When operating with large Sumy, especially if the amount borrowed, or an investment in a trader, a person begins to feel a lot of pressure ...
Acute reactive psychosis - struggle with stress.
... In most cases, this leads to a slowdown in profit, as fewer people at risk, and therefore, wins and loses less. However, in some cases, such pressure may cause a momentary reactive psychosis.
Acute reactive psychosis - a mental collapse. A condition in all its functions associated with psychosis, but it is only the body's response to increased psychological and physical pressure.
In the case of short-lived reactive psychosis, psychologists recommend a long-term rehabilitation, which will be present in itself as psychotherapy, to search for the causes and overcome the short-term reactive psychosis, and various vitamins that increase the body's resistance to chronic physical and mental stress.
When the manifestation of the trader can not adequately analyze the market nervous breakdown, he has a panic, and he can make rash trading, which is likely to lead to its complete destruction.
Unfortunately, there is no one hundred percent working methods, which allow to get rid of the pressure in forex trading. However, there are some tips that will allow you to get rid of extra pressure when operating large sums.
Do not get involved in leverage. Leverage, in most cases, helps to make transactions with a much higher than the capital, but it increases the risks. So, even a one percent fluctuation can completely ruin a trader. Therefore, if you are not completely sure of the performance of a trading strategy, it is better to be careful and do not use leverage.
Competent money management. Large sums - a subjective concept. For some, it is $ 1,000, but for someone a million. Often, the amount of value is not determined by the number of zeros, as a percentage of total capital. The only advice that can be given in this case, is to reduce the percentage of currency in circulation in relation to all currencies. This can be done by reducing the amounts of transactions and replenishment of the deposit. First, obviously, is preferred.
Appeal to shrink fairly common practice forex traders. Appeal to the psychoanalyst can help get rid of the fear of the unknown, as well as help to overcome phobias, excitement and generally restore peace of mind of the trader. Emotional balance trader - 80% trading success in the currency market.
