Success in Forex trading is hindered by psychological factors. Underestimating or ignoring them completely leads to sad results. A novice trader quickly loses money and is disappointed in trading as a way to earn money. Often he blames his failures on the market or trading strategy. In fact, you should always look for the reason of the trading deposit drain in yourself. Ability to recognize your mistakes is a necessary condition for increasing efficiency in trading. This is a very important character trait that will help the trader to avoid certain problems and reach the level of stable earnings. Today I want to talk about the negative consequences for trading of such a psychological factor as overestimated expectations of a trader.
How overestimated expectations affect trading results
Elevated expectations of a trader can be divided into two types. The first of them is the dreams of rapid enrichment, with which a person already comes to the market. Some newcomers to the market initially have confidence that in a short period of time they will be able to earn a large amount of money. She’ll let them live the rest of their lives richly. At the same time, novice traders believe that this can be achieved easily, and it is not necessary to spend a lot of time studying the theory, trading on a demo account and creating a trading strategy. In fact, these traders have a very distorted view of the market and profitable trading. Beautiful advertisements and stories of supposedly successful traders, who were able to realize all their dreams in a short period of time thanks to their earnings on Forex, make a significant contribution to its formation. Such thoughtless attitude to trading can lead to only one result – the loss of funds.Other kind of overstated
of expectations during trading. When opening a trade, a trader
focuses not on the market situation, but on thinking about
how he’s gonna spend the money he’s gonna make very soon. It’s just enough
wait for open orders to be closed with a profit. That’s the kind of attitude that gets in the way
to make the right decisions according to the changing market situation. А
if the deal goes down, the trader gets panicky. Because all his dreams
are falling apart in front of us. In such an emotional state, the right trading actions
are practically impossible. Mistakes grow like a snowball. Loss of deposit
becomes the inevitable finale.Extended expectations have not helped anyone yet. But they can easily become an obstacle to achieving professionalism in trade. That’s why at the very beginning of the way a trader needs to give up any beautiful fairy tales about easy earning on the Forex market.Fyodorov’s Inga12.06.2019