2022-10-10 16:36:23
Trading psychology - the main reasons for the losses of traders
Trader's losses are not so much technical errors. Rather, these are psychological moments. More often than not, a trader only loses money when he doesn't follow the rules of his own trading system. In this article, we will look at fairly common trading mistakes that are made precisely because of psychological moments.
Late entry into the trend
This is one of the favorite mistakes of traders. In slang, this is called "jumping on a departing train." The bottom line is that the trader missed the moment of entering the market and sees that the trend is developing. Naturally, in the end he decides to enter, but he does it too late. Familiar?
Such a mistake can be easily avoided if you write down the rules for entering the market in your trading system and include such situations in them. What if you did not enter the market at the start of a trend or at the time of its early development? It is best to refrain from trading in the future.
A series of losing trades
If you "met a herd of moose", this is not a reason to despair. Yes, it will be difficult for you psychologically. And just this moment also deserves to be reflected in the trading system. What to do if you have a series of losing trades? The best option, as in the previous case, is to do nothing. Just stop trading for a while and mind your own business.
All this sounds easy, but in practice it is extremely difficult to do. The fact is that after a series of losses, the trader wants to return the losses. Here, a casino player turns on in a trader and he starts making serious mistakes. Therefore, it is important to turn off the player in yourself and move away from the screen.
Excessive self-confidence
Many traders, especially beginners, know exactly where the market will go. They are so confident that they are willing to risk a large amount and not set a stop loss. Familiar? Of course, this euphoria is experienced by many in trading. This happens especially often when there is a 100% signal. For example, a clear hammer on support.
But let's not forget that the market is the market. And the price does not look at hammers, indicators and all other tools. The unexpected happens in the market, so it is always important to keep your cool and follow the rules of money and risk management.
173 views13:36
O
