FXTM information and reviews
FXTM
95%
OctaFX information and reviews
OctaFX
94%
XM information and reviews
XM
93%
FXCC information and reviews
FXCC
92%
FxPro information and reviews
FxPro
91%
HFM information and reviews
HFM
89%

How to defeat the fear in Forex trading?


Fear is a natural emotion that people face a lot throughout their life. And since Forex is still quite a risky business, many traders, both beginners and experienced ones, have to deal with their fears in trading.

Can you eliminate this emotion and turn into an absolutely fearless trader? Hardly. But there is definitely a way to minimize the fear and also become more resistant to it. Fear itself is not as bad as the impact that it has on traders: fear paralyzes some of them, cripples their sharp minds and affects the decisions. But once you manage to control your fears, you get to the new level of the market opportunities.

There are several trading fears everyone will most likely experience during their trading. Let’s see what can be done about the two most common fears of the beginners.

The fear of loss


No one likes losing. That’s a solid fact. Moreover, no one likes losing money. But unfortunately, losses are part of the Forex world, and if we can’t completely prevent the thing, we can change our approach to it.

Being careful is important, but trying to avoid any risky situation because of the fear means losing countless opportunities for a win. Fear is, believe it or not, a part of the whole traders path, alongside with taking risks and thinking clear when making a difficult decision. So, what can be done?

Do not risk what you can’t afford


It is pretty logical, right? Lower your lot size to the level that is comfortable enough for you to trade. It doesn't mean you need to trade same $10 all over again – just no need to raise the stakes till the amount that makes you lose your sleep at night.

Do not open too many orders at once


Especially when you are at the beginning of your market journey. The more orders you have open, the harder it is to keep an eye on all of them. Therefore, the anxiety rises. Smaller number of positions help you focus on them more. Check out the video explaining the position size and basic risk management to build a confidence! And in case you want to grow even deeper roots in risk management to be sure you’re protecting your funds the best way possible, read about controlled trading in our Forex Guidebook.

Define the trading plan and follow it. Train yourself to trade one of the classic Forex indicators.


The trading plan is another essential step. It should be clear; it should be suitable for you; it should be followed stickily. That’s pretty much all you need. If you have a very clear and defined idea of when to enter the trade and exit it, it is much easier to overcome the fear of a mistake.

Get yourself a trading journal and analyze it


Make sure you keep a record of your transactions in a trading journal. The purpose of a trading journal is to build confidence in your trading system. When you trade with confidence you are able to trade objectively. Whenever you see your notes about the trade setup, enter and exit, your emotions, you can analyze the strategy and your own state of mind. Besides, it helps you to manage your emotions and actions taken on the market.

The fear of live account


This fear logically comes out of the previous one: whenever a beginner trader starts to think of changing from demo to a real account, this though brings chills down the spine and a sticky fear of “what if I fail”. Demo account is a very good practice and a way to get in tough with the market and the system, let’s face it – it’s not the same as trading real money.

The possibility of risking money is stressful, so you should learn how to handle your emotions and how to overcome your fears to maintain control of your trading decisions. Here are some hints:

Open the cent account


Yes, cent account won’t bring you millions overnight, but it will certainly help you feel responsible for your money – and test your hand. Try start with $50 rather than $1,000 straight away, if you feel anxious. It’s not the amount of the fund that matters, it’s the result, so if you can’t trade consistently with $50, you won't be able to do it with $5,000. So, if fear is settling in, make a few changes and see if that will help you out. Lower risks will help you clear up the strategy and withdrawing profit – even a small one – will lift the spirits.


Just simply DO IT

Forex is about overcoming your fears, as simply as it is, and sometimes it requires bold decisions. The one who’s never mistaken is the one who never did anything – so give yourself some credit. The market can be quite an unexplored area for you yet, but it only means you have so much more to discover ahead of you! Start with smaller sums, don’t rush into it, but ascent step by step to the master trader.

Becoming your own hero


Even small victories are still victories, and small changes lead up to big results. The first step in getting over your fear is rationalizing it: decide on your trading strategy, the one that suits your personality, lifestyle, timetable and other valuable factors. Follow your strategy and keep a track of your moves to make sure you always can come back and learn from your success and mistake rather than be afraid of both. Remember why you started trading – and take a leap of faith!

#source

Share: Tweet this or Share on Facebook


Related

Trading Psychology: What Makes You Lose Money
Trading Psychology: What Makes You Lose Money

All traders are different, but mistakes of psychological nature do not depend on gender or geographical factor. This allows us to highlight several of the most common problems...

Cognitive Bias That Can Affect Your Trading
Cognitive Bias That Can Affect Your Trading

A cognitive bias is a systematic flaw in reasoning that can lead to making wrong decisions while investing. A common maxim in investing is that "you are your own worst enemy"...

The Psychology Of Trading: How To Manage Your Emotions
The Psychology Of Trading: How To Manage Your Emotions

The psychology of trading is one of the cornerstones of success, ignoring it can lead to disaster. For example, Nick Leeson single-handedly...

How to be a Successful Trader? Tips to Improve Your Trading Mindset
How to be a Successful Trader? Tips to Improve Your Trading Mindset

You might have heard a lot of trading coaches say that a positive trading mindset is crucial if you want to achieve something in the trading world. Sounds unlikely, doesn’t it? But reality shows that trading mindset is...

It's all about your Trading Psychology
It's all about your Trading Psychology

As you prepare to start your trading day, what's the first thing that comes to mind? Is it your trading strategy? Are you thinking about different ways to minimize risk in the markets and boost your profits...

Five Trading Myths You May Believe Are True but Aren't
Five Trading Myths You May Believe Are True but Aren't

Want to know some truths about trading? Regrettably, the trading world is one of the spheres with many trading myths – things that sound like facts but are not...


Editors' Picks

FXCM information and reviews
FXCM
87%
ActivTrades information and reviews
ActivTrades
86%
RoboForex information and reviews
RoboForex
85%
MultiBank Group information and reviews
MultiBank Group
84%
Libertex information and reviews
Libertex
83%
Vantage information and reviews
Vantage
83%

© 2006-2023 Forex-Ratings.com

The usage of this website constitutes acceptance of the following legal information.
Any contracts of financial instruments offered to conclude bear high risks and may result in the full loss of the deposited funds. Prior to making transactions one should get acquainted with the risks to which they relate. All the information featured on the website (reviews, brokers' news, comments, analysis, quotes, forecasts or other information materials provided by Forex Ratings, as well as information provided by the partners), including graphical information about the forex companies, brokers and dealing desks, is intended solely for informational purposes, is not a means of advertising them, and doesn't imply direct instructions for investing. Forex Ratings shall not be liable for any loss, including unlimited loss of funds, which may arise directly or indirectly from the usage of this information. The editorial staff of the website does not bear any responsibility whatsoever for the content of the comments or reviews made by the site users about the forex companies. The entire responsibility for the contents rests with the commentators. Reprint of the materials is available only with the permission of the editorial staff.
We use cookies to improve your experience and to make your stay with us more comfortable. By using Forex-Ratings.com website you agree to the cookies policy.