How to better control our emotions? | Forex Factory

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How to better control our emotions?

  • #1
  • First Post: Jan 29, 2008 7:12am Jan 29, 2008 7:12am
i'm sure it's a common problem for all beginners so would greatly appreciate it if anyone can give practical advice on how to better control our emotions.

i realize even if you're good with your entries but a lack of control of your emotions will often lead to :

1) a smaller profit
2) an unwarranted loss

how often do i have to accept a 10 pip profit just because prices would retrace after showing profit. once you close out for small profit or a small loss, the price go your way....sometimes a long way. of course, when i'm playing small things are different and often win over 100 pips but not much profit........

so can better control of our emotions be learned and developed or you're just born the way you are ?
  • #2
  • Jan 29, 2008 7:21am Jan 29, 2008 7:21am
If your emotions are out of check your probably using too much leverage and bad mm otherwise the losing trades would not be so damaging.
  • #3
  • Jan 29, 2008 8:08am Jan 29, 2008 8:08am
Cognitive rational therapy comes to mind. Most people balk at it, but it's pretty damn logical. The fact is that most people don't want to take responsibility for their feelings.

Another thing to check out is EFT, Emotional Freedom Technique. It works amazingly well for emotional problems as well as physical problems.


For example, I suffer from back pain because I broke my back 30 years ago. EFT gives relief like nothing else, including drugs.

Of course my all time favorite is the ball-peen hammer approach. Buy yourself a high quality ball-peen hammer (if you don't know what it is, just go to a good hardware store and they'll help you). Place the hammer on your desk next to your keyboard. Whenever you screw up while trading, such as closing too early or letting your losses run, pick up the hammer and whack yourself in the forehead with it. Just once but hard enough to knock yourself silly for at least 5 minutes. This works extremely well at preventing revenge trading because you can't see your screen anymore.

If you find yourself breaking your rules again, increase the whacks, one for every time you break your rules. I guarantee you'll stop breaking your trading rules in no time at all.

Feel free to send me a check once the therapy has worked.
  • #4
  • Jan 29, 2008 9:02am Jan 29, 2008 9:02am
Quoting Dopey
it. Just once but hard enough to knock yourself silly for at least 5 minutes. This works extremely well at preventing revenge trading because you can't see your screen anymore.
The next step is to buy a chainsaw...see then miraculous results

Try to build up experience and in time you'll over some part of your emotions. Until then, keep trading small lots
"Abandon all hope, you who enter here" La Divina Commedia, Dante Alighieri
  • #5
  • Jan 29, 2008 10:10am Jan 29, 2008 10:10am
Quoting findcount
i'm sure it's a common problem for all beginners so would greatly appreciate it if anyone can give practical advice on how to better control our emotions.

i realize even if you're good with your entries but a lack of control of your emotions will often lead to :

1) a smaller profit
2) an unwarranted loss

how often do i have to accept a 10 pip profit just because prices would retrace after showing profit. once you close out for small profit or a small loss, the price go your way....sometimes a long way. of course, when i'm playing small things are different and often win over 100 pips but not much profit........

so can better control of our emotions be learned and developed or you're just born the way you are ?
when i started I knew i wanted to treat forex like a business. I even made a 'contract' for myself to follow a plan and such.

And when you think about it, good businesses doens't become successful overnight. Takes time and work. So trading is the same thing.

When I think like that, I eliminate any kind of foolish emotions that plague some people that lead them to over trading and high risk trading.
  • #6
  • Jan 29, 2008 7:35pm Jan 29, 2008 7:35pm
many thanks to all...........i guess this is something one self has to go through........

Dopey, i've heard of EFT before but it's expensive right ?
  • #7
  • Jan 29, 2008 8:31pm Jan 29, 2008 8:31pm
Get and read, Trading in the Zone, by Mark Douglas.
Same Whore .... Different Dress
  • #8
  • Jan 29, 2008 9:27pm Jan 29, 2008 9:27pm
I receive an EFT newsltter form the following site;
http://www.emofree.com/default.htm
worth browsing through...

Concerning emotions in trading. As you are staring at a screen you are either in the past "- Oh I should have..." or in the future "When it gets there I will..." ---you are 'talking to yourself.' and you talk yourself into aborting trades too early or staying in too long.

-hang on and follow me here ----
If you pay close attention while you are thinking you will notice that your tongue is 'tense' ready to respond. (remember your talking to yourself)
Relax your tongue. I mean focus on it and relax it. It is almost imposible to feel emotion while relaxing your tongue -- you have effectively removed the cause of emotion, emotions need time (past and future) and cannot be present in the present...
Relaxing your tongue forces you to be present.

I'll stop here as this line of thought is probably ' to out there' for many - and there has been enough weirdness around the site recently already...LOL
In trading, there is no bullshit. You either make money or you don't.
  • #9
  • Jan 29, 2008 10:04pm Jan 29, 2008 10:04pm
Quoting findcount
many thanks to all...........i guess this is something one self has to go through........

Dopey, i've heard of EFT before but it's expensive right ?
No, it's free. Here's the link.

http://www.emofree.com/downloadeftmanual.asp

My friend has bought some in-depth stuff at a cheap price and he swears by it, but I haven't needed it.
  • #10
  • Jan 29, 2008 10:13pm Jan 29, 2008 10:13pm
Another resource is the "Power of Now" by Eckhart Tolle. I think many of us are aware of the idea he presents on a very basic level, but like most things it has to be brought to the forefront of our consciousness to understand and practice it so that it makes a difference.



I first came across the idea in college when I read Nietzsche. He said that man is at his best when he lives in the moment. Tolle shows how to do just that and free yourself from the bullshit that your mind inflicts upon you. As Walt Kelly said, “We have met the enemy and he is”; truer words you’ll never read.
  • #11
  • Jan 29, 2008 10:42pm Jan 29, 2008 10:42pm
For me, the best way to control my emotions is by having a complete set of rules to follow. If I know what must happen for me to enter a trade, where I'm planning to exit and how I'll manage it along the way, my emotions can't really get a foothold. Whenever something bad happens, or if the trade starts to go south, I already know what I'm going to do depending on the situation (i.e. close at breakeven, let myself get stopped out or close early, etc).

After a while, when you get most of the common things that happen associated with some rule or another, there shouldn't be much of an emotional reaction--because you already know exactly what you're going to do in nearly every situation. Trading becomes boring and you know you've finally made it (maybe not profitable, but closer to becoming a professional).

For me, the only time I really get mad is when, win or lose, I didn't follow the rules I've made and I acted on impulse. Fortunately, that's happening less and less (he says today...check me tomorrow after the interest rate announcement )

Oh, yeah, and I'm reading "Trading in the Zone" by Mark Douglas like johnedoe suggested. Great book so far...

Ed
Indicators are to Price as Newspapers are to Bloomberg.
  • #12
  • Jan 29, 2008 10:48pm Jan 29, 2008 10:48pm
Quoting Dopey
No, it's free. Here's the link.

http://www.emofree.com/downloadeftmanual.asp

My friend has bought some in-depth stuff at a cheap price and he swears by it, but I haven't needed it.

many many thanks........great that it's free...........for a cheapskate like me !
  • #13
  • Jan 30, 2008 3:13am Jan 30, 2008 3:13am
For those who interested on "Trading in The Zone", u can pass me a pm with your email..with a pass: "parlenk ..i love u" .ROFL
  • #14
  • Jan 30, 2008 8:13am Jan 30, 2008 8:13am
Let's think about it for a sec, what is the source of whatever emotions you are feeling? The source is uncertainty, not being sure of an outcome and lacking confidence because of not being sure of the statistical reliability of your actions.

When we take a loss, but we know that we did everything right, the emotions involved are almost nil, because you know that over time if you keep doing this, it will make money. HOWEVER if you do not know that what you are doing makes you money over time, then you have no way of knowing you've been doing everything right, and in turn when taking a loss you'll want to hate yourself. Probably leading to more damage.

If you pulled the trigger and it made money, but you do not know that whatever it is you did makes money over time, after you'll bank those profits you will become attached to them and will be afraid to repeat the same action, leading to missed opportunities, self hate and regret. HOWEVER if you do know whatever it is you did makes money over time, you will be looking forward to pulling the trigger. The only thing you will feel is ease and comfort regardless of the possible outcome.

This leads me to say that as technicians we need to carry out some statistical studies in order to prove to ourselves whatever truths we'd "discovered" about the market. I am conducting extensive research at the moment and will soon publish it for free on FF. Research leads to confidence. Confidence leads to ease and comfort. You put on a trade and expect something to happen. You don't know what the hell it's gonna be, but something will happen. What you feel should be exactly the same either way because you have your statistics and are confident probabilities are on your side. It is something to master, and I have not yet mastered it, but it's a process.

Bob
  • #15
  • Jan 30, 2008 9:20pm Jan 30, 2008 9:20pm
i find that sometimes, losses can actually help to keep you in the winning trades longer once you get used to things going against you initially........

so losses can be helpful.......... especially when you know why things went wrong.
  • #16
  • Jan 31, 2008 1:57am Jan 31, 2008 1:57am
Quoting findcount
i find that sometimes, losses can actually help to keep you in the winning trades longer once you get used to things going against you initially........

so losses can be helpful.......... especially when you know why things went wrong.
Well losses of course are part of the learning process.

Everyone needs to go through losing some money - only then will you be able to tell what kind of reaction and what kind of person you really are, when your hard earned cash is on the line.
  • #17
  • Nov 25, 2016 7:54am Nov 25, 2016 7:54am
If you want to proficiently trade Forex, a trader must control your emotions. Emotions will have no room to interfere if you follow the right track which is learning the basics and Demo trading for at least 6 months or so to master your trading system. This will help in controlling your emotions.
  • #18
  • Nov 26, 2016 6:59am Nov 26, 2016 6:59am
I am not so sure that demo account trading helps much with learning how deal with emotions related to trading. It can help you expand your knowledge and experience, which in turn can provide you with some confidence, but the true emotional trading begins with the opening of the live account.
  • #19
  • Nov 26, 2016 5:16pm Nov 26, 2016 5:16pm
Quoting mlawson71
I am not so sure that demo account trading helps much with learning how deal with emotions related to trading. It can help you expand your knowledge and experience, which in turn can provide you with some confidence, but the true emotional trading begins with the opening of the live account.
100% - The difference was immeasurable for me. Demo was virtually irrelevant. Different from person to person, but overall, I expect its quite significant for most new traders.

Get a general idea about trading via a demo, but you need to step up and put some actual money on the line...100, 500, 5000+...whatever it takes to feel like the gains and losses matter, without being anywhere near the amount that affects your day to day finances.
  • #20
  • Edited 11:09pm Nov 26, 2016 10:59pm | Edited 11:09pm
Quoting findcount
i'm sure it's a common problem for all beginners so would greatly appreciate it if anyone can give practical advice on how to better control our emotions
Would you ask a bricklayer how to lay plumbing properly? Would you ask an average car commuter how to drive at Nascar racing? Would ask weekend hunter how to wage a war against drugs lords?

So why would you ask unqualified amateurs, like most people writing here, on a subject like psychology? And even if they might poses a grain of truth, that may be exactly a grain that will be harmful to you.

Know yourself... with help of professionals in the field:

1. NeuroInvesting: Build a New Investing Brain by Wai-Yee Chen

2. TraderMind: Get a Mindful Edge in the Markets by Steve Ward

3. The Mental Edge in Trading : Adapt Your Personality Traits and Control Your Emotions to Make Smarter Investments by Jason Williams

4. Trading in the Zone by Mark Douglas

5. Strength Finder 2.0 by Tom Rath

6. What Motivates Me by Adrian Gistick

7. Choke: The Secret of Performing Under Pressure by Sian Beilock

8. Talent is Overrated: What Really Separates World-Class Performers from Everybody Else by Geoff Colvin

9. The 700 Habits of Highly Ineffective People: And How You Can Avoid Falling into Them by Jonathan Biggins

10. Too Soon Old, Too Late Smart: Thirty True Things You Need to Know Now by Gordon Livingston

11. Sun Tzu for Success: How to Use the "Art of War" to Master Challenges and Accomplish the Important Goals in Your Life by MICHAELSON GERALD & STEVEN

12. In Pursuit of Excellence: How to Win in Sport and Life Through Mental Training by Terry Orlick

Read these books, reflect on them and find your strength... then you will be able to find a way that is COMPATIBLE WITH YOUR PERSONALITY... whatever it is 10 or 1000 pips... but without knowing yourself you dont know what are you looking for... and nobody will be able to tell you that except yourself...
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