Fear

Emotions always accompany a trader in trading. There may be some traders who have developed the ability to trade in an atmosphere of complete peace and quiet, but they are definitely very few. The range of emotions that a trader experiences can be quite diverse. But insurance is always present to some extent. That’s why I’m the one who decided to dedicate this article to him. What does a trader fear most often? How destructive is the impact of fear on trading results? Or maybe he’s doing a useful job, too. Let’s try to find answers to these questions.

Three types of fear can be clearly identified, which are peculiar to traders. Especially those who just got to the market. Beginners are afraid of losing their deposit, losing profits and losing out in their quest to succeed in trading.

Negative impact of fear on trade

This emotion restrains the trader’s freedom of action. It experiences difficulties in making decisions on opening or closing orders. The trader is afraid of losing profit and closes the order earlier than expected according to the trading strategy. But in that case, he’ll lose only a fraction of his profit. But if fear prevents a trader from closing a losing position, it can lead to much sadder consequences.

Injury can be the cause
of illogical and uncontrollable actions. Trader forgets about trading rules
and begins to act impulsively, without reacting to technical
of the indicators included in the TC. The negative result of such trading is practically
foregone.

Lost deal can “paralyze” a trader. It has insurance before continuing trading. The trader thinks he’s going to be haunted by failures all the time. And it becomes very difficult to enter the market again, even if the signal fully corresponds to all the conditions of the trading strategy.

Use of fear in the forex market

Oddly enough, this emotion may be useful to the trader to some extent. Fear in everyday life helps us not to do anything reckless. This quality can also be seen in trade. A novice trader often hopes for a miracle when he sees that the market has resolutely gone against the open trading position. Maybe the price will turn around and the deal’s a plus. Expectations of positive changes in the market in most cases lead to an increase in losses and a rapid reduction in deposits. And it is the insurance that makes a trader close the order without waiting for a significant increase in losses.

How to get rid of fear? I don’t think we can do it completely. But it’s possible to minimize its power. To do this, you need to have a profitable trading strategy and develop a strict discipline.

Fyodorov’s Inga

09.07.2019