When emotions drive your trading decisions it will never let you make rational choices instead you will act on your gut-feeling. It’s very common for an emotional trader to overlook all the logical signs and take decisions based on their feelings which can lead to huge losses.
The disadvantages of not having control over emotions in trading?
- Thread starter wajidali874614
- Start date
- Watchers 53
I think one deals with a lot of nervousness when he/she is overly exposed in the market. If you have a capital of $1000 and you trade with mini lots instead of micro lots then it's easy to make mistakes that one cannot easily get out of. For example, when you see the PA running fast against you, and your equity diminishing painfully, it's easy to take irrational decisions and therefore become disappointed and conclude that trading is not for you.
hey rc...... you have a wise signature phrase......
lot size is something that appeals to me..... where some are consumed by ever increasing that size , i am consumed in ever reducing it.....
as example, my max average lot size tends to be 0.03 ...... and i wish it was smaller..... some of those accounts are quite large..... but over many thousand trades, the max average lot size will seldom rise above 0.03 ......
//------
my tendency is using few words as possible but i believe this is worth the exception......
i remember several years ago on forexfactory, two widely followed traders made different trades just before christmas...... one shorted the eurusd and another shorted one of the cad crosses, eur, aud or nzd..... by coincidence, i was short on both also.....
the first trader had around 5 standard lots short on the cad cross, he called it his christmas present...... as the trade went against him he added more and more...... he is a counter trend trader and that is what they do..... after several weeks of non stop boasting about how much he was going to make, he fell silent for many many months..... both our trades ended in a loss...... mine was 0.02 lots.....
a second trader placed three separate trades of 5 standard lots each short on the eurusd...... that's 150$ a pip ...... i was short also my typical size...... the eurusd went against us several hundred pips...... do that math....... my 0.02 lot trade ended in a minor loss......
surprisingly she held on...... 15 standard lots with a several hundred pip drawdown...... finally closed for a profit a few months later for her standard 10 pip profit target.......
my trades were for sure real and for sure each ended in a minor loss...... both traders each posted on forexfactory more than enough information for me to be convinced their trades were equally real......
of the 3 of us, which one had the less stressful christmas.....h
//------
lot size is something that appeals to me..... where some are consumed by ever increasing that size , i am consumed in ever reducing it.....
as example, my max average lot size tends to be 0.03 ...... and i wish it was smaller..... some of those accounts are quite large..... but over many thousand trades, the max average lot size will seldom rise above 0.03 ......
//------
my tendency is using few words as possible but i believe this is worth the exception......
i remember several years ago on forexfactory, two widely followed traders made different trades just before christmas...... one shorted the eurusd and another shorted one of the cad crosses, eur, aud or nzd..... by coincidence, i was short on both also.....
the first trader had around 5 standard lots short on the cad cross, he called it his christmas present...... as the trade went against him he added more and more...... he is a counter trend trader and that is what they do..... after several weeks of non stop boasting about how much he was going to make, he fell silent for many many months..... both our trades ended in a loss...... mine was 0.02 lots.....
a second trader placed three separate trades of 5 standard lots each short on the eurusd...... that's 150$ a pip ...... i was short also my typical size...... the eurusd went against us several hundred pips...... do that math....... my 0.02 lot trade ended in a minor loss......
surprisingly she held on...... 15 standard lots with a several hundred pip drawdown...... finally closed for a profit a few months later for her standard 10 pip profit target.......
my trades were for sure real and for sure each ended in a minor loss...... both traders each posted on forexfactory more than enough information for me to be convinced their trades were equally real......
of the 3 of us, which one had the less stressful christmas.....h
//------
Last edited:
While trading, I try not to look at my profits or losses. It’s hard but it’s even harder to look at those figures and not feel any emotions. What I do is that I set trailing stop loss which gives me surety that I can’t lose or win beyond a certain level. Also, once I’ve closed the trade, I don’t think about what could have happened if I hadn’t stopped out and all because these can really cause a surge on my emotions as a result of which I can not focus on upcoming trades properly.
As I see, revenge trading is one of the most common problem by the new traders! I think, you can remove the running trades feature on your live trading terminal; then you’ll never see the loss/profit on your live trading chart! But again, having a proper money management plan is so important here!
Emotions can have a significant impact on Forex trading. Greed, fear, and excitement are all emotions that can stymie progress. To pause and return to a stable emotional state, a high level of awareness and self-knowledge is required. When emotions take over in Forex trading, traders may make rash and irrational decisions, such as:
- Moving away from the money management strategy in order to compensate for the lost amount and spend money they can't afford to lose.
- Opening trades without first analyzing the chart and conducting a thorough analysis of the market situation.
- Using new and untested strategies without first putting them through their paces on a demo account. If you have any doubts, it is best to set aside your live account and focus on a demo one.
- I'm hoping for the best and staying away from the Stop Loss and Take Profit functions.
Your emotions can become a difference in your success and failure in forex trading. Consider creating personal rules, trade the right market conditions, reduce your trade size, and most importantly, relax when you don’t feel right. Continuing to trade after consecutive losses can lead to revenge trading.
Uncontrolled emotions push you to make decisions that are supported by facts. As a trader, before taking any decision, your first job is to analyse the market. If you lack the ability to see risk and take decisions because of an emotional response, you will always fail.
Similar threads
