Posts Tagged ‘emotions’

21.08.2012 Post in Trading

Every time we take up something new, we have doubts. And this is normal! Doubts are the result of estimating yourself, of searching personal features that are needed for this new activity. At the beginning of the journey a trader cannot avoid being unconfident of his/ her abilities, knowledge and skills. This is exactly what urges to look for more information and for the advice of the experienced, to visit courses and webinars, and in fact, to being extremely cautious. It is concerns, that trigger our self-development, that appear to be the signs of success in the future activity.

Of course, for a totally green on Forex trader it is significant to master technical and fundamental analysis. This is needed to understand the way the international currency market operates, as “trader” is a very difficult occupation, which requires skills of analysis as well as special knowledge. The sign of that the work is effective can be non-randomness of profit, ability to explain what stands behind every step on Forex market.

It may seem that having realized the rules of the financial markets and read a lot of books, i.e. having acquired sufficient information about trading and Forex, one can easily add funds into a bank account merely sitting in front of the PC connected to the Internet. But it is not that simple!

The main part of people sees the most attractive feature of trading in the easy way to earn money and fast speed of getting rich. And of course, these ideas cannot but worry and evoke powerful emotions. A novice trader is so much captivated by a zest to yield, that he / she is incapable of realistic estimation of personal actions on Forex. Aside from knowledge and logics, in order to profit on Forex, discipline and cold reasoning are necessary. An ability to stop in time, to enter the market at the correct moment, to be very attentive, to monitor carefully the currency exchange rates and to behave with no hazard – all these skills are the main supporters of a profitable trader. Being absorbed by emotions is considered as the main obstacle for the newbies.

Emotions urge to act, help to go forward and never stop. But being overwhelmed by emotions disorient and has a negative impact on the attentiveness. Huge expectations from the trades conducted increase their importance so much that they cause a trader’s lack of self-trust. In this case, this self-doubt prevents from gradual development as a professional.

So, emotions or logics? Both! The Golden Mean Rule has never been cancelled.

Using knowledge and skills of analysis will definitely help you to work on Forex, but a certain share of emotions urging you to accomplishments will not be excessive.

Good luck in conquering new highs!

Added by Andrey Misyuk,
InstaForex Clients’ relationship manager