Trading is an emotional rollercoaster
It is a very natural human tendancy to want to stay in a losing trade in the hope that the market will turn in your favour and you can regain your losses to close your trade at a more financially acceptable level. Similarly, when you are making a profit it is very hard not to grab what you can get while you're up, instead of riding out the trend even if the market temporarily turns against you.
However, as our basic principles state, the only way to make money in forex trading is to let your profits ride and to cut your losses quickly. This is because there is a very narrow margin between making an overall profit and blowing your account since you will have a large number of losing trades, no matter how good your trading system is or how lucky you are. How you manage your losses and gains makes the difference between a successful and unsuccessful trader.
In our opinion, the only way to control your emotion is to trade according to a system or set of rules. Your system should be comprehensive enough to cover any eventuality arising in the markets so that you never need to make any decisions while in a trade. You simply follow a set of predetermined rules.
Chat Forums
Forex trading is a very lonely occupation as you sit behind a computer terminal all day, isolated from the world. This in itself is enough to make you feel very depressed and despondent. Subscribing to forex chat forums will help to alleviate some of the loneliness. At least then you get some insight into the lives of other traders around the world and you can get an opportunity to interact with them.
It is a very natural human tendancy to want to stay in a losing trade in the hope that the market will turn in your favour and you can regain your losses to close your trade at a more financially acceptable level. Similarly, when you are making a profit it is very hard not to grab what you can get while you're up, instead of riding out the trend even if the market temporarily turns against you.
However, as our basic principles state, the only way to make money in forex trading is to let your profits ride and to cut your losses quickly. This is because there is a very narrow margin between making an overall profit and blowing your account since you will have a large number of losing trades, no matter how good your trading system is or how lucky you are. How you manage your losses and gains makes the difference between a successful and unsuccessful trader.
In our opinion, the only way to control your emotion is to trade according to a system or set of rules. Your system should be comprehensive enough to cover any eventuality arising in the markets so that you never need to make any decisions while in a trade. You simply follow a set of predetermined rules.
Chat Forums
Forex trading is a very lonely occupation as you sit behind a computer terminal all day, isolated from the world. This in itself is enough to make you feel very depressed and despondent. Subscribing to forex chat forums will help to alleviate some of the loneliness. At least then you get some insight into the lives of other traders around the world and you can get an opportunity to interact with them.
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