Thanks for another Great contribution AO
Amazing thread...I'm writing a book about psychology and trading - would you mind if I borrowed some of your statements/conclusions?
I am liking this thread, thank you for the inputs.
I am a passion trader who always thrive to improve her trading skills. I notice myself that I never used to have a good enough or clear plan that it can give me enough confident to stick to it and trade with the plan accordingly. I have never been a greedy trader so never been too cocky and blow my account up after few good trades. I have tried doing many different things to strengthen up my mental toughness, I did the things I would never do , the latest one was working on the street as a fundraiser for Greenpeace, asking strangers randomly to sign up for monthly donations. After I have done that for a month and coming back to trading, suddenly, I am a lot clearer what I can do for my planning, and begin to take some very good trades in regarding of timing in entering a trade .
Although that part is sorted , I can haunted by my mental weakness for fear in losing a trade. Often I closed my trades too early for fear the trade will turn into a lose -it happens when I am starring at lower TF, M15 or lower ,bare in mind I am not even over leverage, so as soon as there is one or two not too nice looking candle bars come out, I would bail myself out with some humble 3-4 pips profit, and only to see my strategy play out completely as I wished. I have to remind myself that when just before something to take off, there would be some form of struggling within the price.
So it comes down to how much awareness do I have, especially in a live trade.
The question I am now drilling into my mind, that I will not stop asking, especially during a live trade is that - "Are you willing to give up the Forrest for just the two trees?"
Forrest =final target,
the two trees = the not so good looking bars instantly deliver from low TF
or Two trees?
The choice is up to ourself. Personally, I choose Forrest.
Great Read and Concept PG
Most Traders wrestle with either or both Greed or Fear of Loss emotions during Trading to varying degrees.
I recently read this book How-I-Made-2000000-in-the-Stock-Market by Nicolas Darvis.
This has been one of my biggest trading teachers.
Best wishes to you and all who read this.
When it comes to money this word gets its highest and strongest power, because of all the psychological issues that money awakes in each human being.
I think trading is so difficult to learn because when we put money and uncertainty all together something in the mind immediately reacts and unables people from thinking how they should think: so they all end up "trading not to lose instead of trading to win" - quoting a great CP's sentence here -.
I understand the words "trading not to lose" as the vain attempt to make certain what is uncertain.
There is a big lag between noob traders approach to trading and market environment: most of them keep on thinking in terms of right or wrong, meanwhile market is just a world of possibilities: there is no right no wrong.
So what? which is the point of trying to be right when there is no right nor wrong?
This is the hardest psychological issue that must be overcome and requires a radical shift of mindset.
This apparentely little difference in perspective is strongly conditioning and affecting the hole thinking process of a trader, from reading price action to adding some indicators for a better understanding and to building a correct risk management strategy and to decision making process: in other words it affects the hole trading process and therefore final results.
Those results will be exactly the ones that the noob trader is struggling to avoid: losses.
This is one of the strongest and most unknown natural laws: as you believe in your heart, so it will be done: this is the law of life and of living.
I understand the words "trade to win" as the solution to the above big issue:
trying to make certain what is uncertain, that is to say trying to predict, trying to confirm, trying to be right, is fool!
There is no way to make it, but there is the way to be safe even in an uncertain environment: do not avoid uncertainty, manage it.
Therefore it is not a fancy trading system that will make you a pips reaper but the risk management strategy you use, supposed you have one.
Finally, i want to make it clear right now: i'm not speaking of money management but risk management: the difference is huge, although they both must play all together: money and risk management are two different things but they cannot exist without one another.
How to make it? stop thinking in terms of right/wrong and begin to think in terms of possibilities, it's that simple.
Great tread. Super informative first post. Still, a good strategy is a must have... Train your mindset as much as you like, if the strategy is not really good, you will still lose all your money.
If mindset traning was the only way to make it work, every kid with a stick can beat the shit out of Roger Federer on the tennis court... You know, a stick is all you need agains Federer?!?:-)))
Successful forex trading life require a combination of greater mental strength and forex education so that a trader can remain assured about all aspects of trading: they can engage in rational; emotion free wise trade decision. However; practicing with demos can be slightly different from the live trading. Since; in demo trading we are completely risk free of losing money. In case of live trading accounts; we have to deal with our nerves so that money can be properly managed with a view to earning money.
How should a trader deal with an extended period of losing streak?
NO.. all 3 are EQUALLY important !! no matter how good your "mindset" is you WILL fail IF you have:
A fail Method/Strategy: You will never going to achieve a long term positive result, no matter how much "mindset" you have IF if the "method" will not allow you to have an edge over a 50/50 chance to win (basically random trading) PERIOD!!!
A fail Money Management: If you dont understand how to manage your capital and how IS CONNECTED to the "method/strategy" (most people are not aware of this) you can rollercoaster your account up and down with no consistency and you can eventually can get a margin call OR make a ton of money and lost all of them easily (basically a random result.. again) PERIOD!!!
ALL 3 ASPECTS ARE IMPORTANT, THERE IS NO SUCH THING AS "TRADING ITS ALL ABOUT WHATEVER % MINDSET (ABOVE ALL)" THATS ONE OF THE BIGGEST MYTH IN TRADING UNTIL THIS DAY
FAIL AT 1 OF THEM AND THE OTHERS 2 WILL NOT MAKE UP FOR IT !!
Just like trading the markets!
Built in aliasing.
Nice thread. Nevermind charts, Flood and flow are the best indicators for a trading day. Flood = disaster, flow = profit.
One of the most underrated threads on FF. I will come back from time to time to read your posts again, you did a great job my man!
insightful and practical! great share! tks a lot!
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