FX traders have to deal with a lot of changing environments and frequent decisions during the normal course of a trading day. How many times have you said to yourself “I know it’s going backup” or “I’ll average down just this once” or “They’re coming for my stop, I’ll move it down a little so they don’t get me”. All are valid decisions in your mind at the time. How about those times when you’ve taken a small drawdown just to find you don’t have the courage to pull the trigger on the next setup because you’re afraid of losing 5-6 in a row. Did you know statistically you have a 25% chance of losing 7 in a row?
So what’s the first thing you do after a losing streak or a sustained slump? My guess is one of two things. Either you increase your position size to try and get it all back at once or you tinker with your trading plan and try some “new “ strategy or strategies to try and make up those loses because you’ve suddenly lost all confidence in your system or you do a combination of the two. Both, I would submit, are wrong and potentially financially disastrous. Believe me, I’ve been there and done that.
As I talk to traders from all over the world the same questions keep coming up, “What can I do to make sure I’m around tomorrow to keep doing what I love to do”? And “How do I keep from blowing up my account? Let me suggest that the answer lies between your ears.
All successful FX traders have spent a great deal of time developing a comprehensive trading plan and used a demo account to practice their plan before trading live. They also keep detailed records of their win/loss percentage (batting average) and the percentages of their average win and average loss. Taken together these metrics are necessary to determine a traders’ profitability and to know if their trading plan is a sound plan. But what happens when you start to experience that losing streak and you start to second-guess your decisions? Is it your system or is it YOU?
Let me suggest an option that will keep you from letting your emotions and your ego get the best of you. Assuming that your trading plan is sound, how can you avoid those emotional pitfalls that keep you from realizing your profit potential? One of the coolest new tools available to FX traders is an Automation Tool that we offer called “The Forager”. It will let you preset your trades including entry price, risk control, take profit price and trailing stop among several other customizable settings.
You’re asking what does an AT product got to do with psychology? Everything I’m afraid. The second-guessing, the changing of stops, the sleepless nights that mess with your focus can, with the help of “The Forager”, dramatically reduce the stress and indecision in your trading. You will be able to customize the settings to fit your parameters and then walk away with the confidence that your initial trading strategy will be executed. Remember, the robot is not here to replace you, but to give you the confidence to trade your plan without all that emotional stress that creates those unforced errors or turnovers.
Trading is a lot of things, but I believe that the more emotionally stable and confidant one is will ultimately determine if they will be successful long term in the FX markets. I encourage you to take a look at the way “The Forager” can help you improve your results.
Forager Robot…. its capabilities are explained at https://www.eaforexforager.com/trading-robot
theforexarmy #forexsigns #forexsignals #forexfamily #forexgroup #forexhelp #forexcourse #forextrade #forexdaily #forexmoney #forexentourage #forextrading #forex #forexhelptrading #forexscalping #babypips #forexfactory #forexlife #forextrader #financialfreedom #daytrader #scalper #swingtrader #fx #currency #traders #pip
