Mindset or what is often called trading psychology is one of the important components that affect the success of a trader in trading. If you beginner trader, you must know the best forex trading mindsets that influence you to be a successful forex trader.
Psychology affects the mental and self-confidence of a trader. In addition, psychology also affects the mindset. Mental and the right forex trading mindsets will determine the success of a trader.
Forex trading psychology is how a trader thinks and acts when a transaction is about to happen or is in progress.
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Traders who have the right forex trading mindset will be able to face obstacles in the forex market and then increase the equity in their accounts consistently.
There are 2 things that always affect trading psychology, namely: Greed and Fear.
Greed will arise when the trader is making a profit, usually, there will be a desire to reap even greater profits, so that in the end all profits will disappear due to miscalculations.
Meanwhile Fear will arise if the trader is in a state of loss (floating loss) then the trader will feel panic and fear. As a result, traders tend to lower the SL and hope that the price will reverse, causing even greater losses.
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Best Forex Trading Mindsets for Beginner to Be Professional Trader
A professional trader will be able to overcome fear and greed at the same time, so it is not easy to panic or pat his chest too early so that he can reap profits consistently.
Things that must be considered in training trading psychology so that the 2 things above can be controlled in order to obtain consistent profits are:
1. Discipline
Trading psychology is very important because it is important to remember that in real trading, traders are dealing with other traders.
So if the trader is more disciplined in holding fast to the trade plan from the start, the trader will have an advantage over a trader who is controlled by emotions.
Building emotions is not an easy matter, because it takes time and hard work. As a first step, use a journal to record all aspects of trading both when you are making profits and when you are losing, including feelings before and after trading.
Do it regularly and consistently, after a few weeks, the trader can check and evaluate what mistakes were made and under what circumstances/feelings and then correct them.
2. Accepting Defeat
The next step is to accept defeat when the market does not move in the desired direction. There is no perfect strategy, even if there is a claim to the best strategy in the world.
The best possible strategy will give a maximum of only 75% success on every 100 positions, 25% chance of losing positions.
In order to stay on top of numbers like that, traders must learn to control their emotions when they lose. Usually, when emotional, traders tend to take revenge in order to quickly win back.
A professional trader will accept the defeat and admit that the defeat is unavoidable.
One way for a trader to accept defeat is to assume the money is lost/fallen somewhere or it can be said that money is not used for anything.
3. Emotions Controlling
Being a good trader is being able to control emotions. But being an emotionless trader is very difficult, why? Because humans are created with emotions, but we can train these emotions before, during, or after trading.
In the human brain, there is a part called the ‘amygdala’ which is large and shaped like an almond. The results showed that this section is the part that is associated with a person’s mental and emotional condition.
According to the results of research in the book The Human Amygdala by Paul J. Whalen and Elizabeth A. Phelps.
The size of the amygdala, which was measured from about 56 youth volunteers and 58 parent volunteers, showed that the amygdala size of young children was relatively larger than the size of the amygdala of parents.
The size of the amygdala of young people is around 1750mm, while the size of the amygdala of parents is around 1600mm, although the size of the brains of older people is generally reduced. This can also illustrate that young people are more difficult to control emotions than older people.
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After you get a trading system (trading method) that suits your character, your trading psychology will be maintained, remain calm and comfortable when transacting. A trading system (trading method) that is comfortable when used will make your trading psychology run according to the system.
After the trading system (trading method) and your trading psychology are matched, you can easily manage your finances (money management). To get a good trading system in this case that suits our character, it takes to process, time, and flying hours.
How about this forex trading mindsets knowledge for You?
