Is your trading discipline what needs to be improved?

 

It’s hard to completely understand trading psychology unless you have had direct investing experience. Most of the traders know that getting and staying in the right mindset is essential.  This is especially true for the short-term traders, even the swing traders. If you are, you will need to make quick decisions on short notice, which can be the difference between a profitable or losing trade. At the same time, you need to be able to stick to a previously established plan where you are confident in taking profits and executing a stop loss.  Your emotions need to be in check and they simply cannot get in the way of making time-sensitive trading decisions. Making a quick decision in trading is essential. You need to be able to scan the markets in under an hour using the technical analysis and to find a trade which fits your longer-term key levels and trading strategy. After that, the trading decision should be made within a few minutes of looking at the chosen time frame.

Part of understanding forex trading psychology is to recognize the presence of fear and greed.  While losing money is something you need to accept as part of the business of trading, it is hard to learn how to tolerate the uncomfortable feeling you will experience when you are losing money.  You need to have emotional discipline as a trader, but it does take time to become relaxed and take losses in stride. If you want to become successful, it is important to know the effects of losing and winning on the psychology of a trader.

Fear comes along with the money losing.  Fear can overwhelm you if the position size is larger than normal, especially if you did not plan on taking a larger than normal loss. If you are a disciplined trader, when losses come around you will deal with them appropriately.

Experience will teach you to remain calm if you have drawdown that falls within your range of expectations.  If you have a strategy that wins 50% of the time, you should expect losses. You will never be happy when the market is moving against you, but if your strategy shows losses 50% of the time, you will become more comfortable with a loss as a potential outcome.  What is much harder to handle is a situation where a trader takes unplanned risks which can adversely affect their investor psychology.

The losses and fear will need a continuous work on your trading psychology and discipline.

•  1 step-work on your mindfulness, awareness (breathing techniques, meditation, sports activities, reading)

The first step from 3 that you need to take, is to be aware of the present moment, to be mindful, to make a good trading decision.

According to the National Centre for Biotechnology Information,  the average human attention span has dropped from 12 seconds in 2000 to 8 seconds in 2013 (just one second below that of a goldfish). There are some researches that it is even below 5 seconds now, which is a huge problem for the traders, for trading. Too many instruments, too many information, if you don’t have developed trading strategy and a trained brain for technical analysis, you will not be able to make a good trading entry decision and you will end in 98% of the traders that are losing money in the markets.

The most important fact you should know that your trading is all about the probability of survival. You need patience and discipline to push yourself in this “lucky” 2% of the traders that are winning over time.

•  2 step-remove your fear and gain confidence (ego removal, taking online trading courses, consulting with mentor traders)

Accept the fact that you will have a losing streak, accept the fact that you will not have a 100% winning ratio. This will remove your fear. Your mind with this acceptance will be calm for making trading and when you are executing trades.

•  3 step-train your brain to make sound decisions in a short period of time (improving your technical analysis)

Technical analysis is a great tool. But if you are making it too complicated you will block yourself. Technical analysis in three steps should give you a direction, key levels for resistance, support, breakout or pullback, and based on a price action around this levels-execution. Simple as that.

Trading the forex market requires a sound trading strategy that you can execute efficiently.  In addition, you need to be able to follow a disciplined trading plan and avoid letting your emotions get in the way.  You must understand that fear is a very powerful emotion.  Most traders feel pain when they are losing money.  This is a psychological crutch and needs to be addressed by each trader.

To improve your trading psychology and to improve your trading we have developed a Funded trader program which will provide you intensive two weeks training before you receive 10k in funds for your Live trading account. We will prepare you to and constantly overview how to:

•  Apply proper Methods and Strategies (using Technical Analysis of course)

•  Apply good Money Management

• Discipline to manage your emotions and working on your trader mindset (easy to say, but far away from easy to apply even for experienced traders)

Top-down trading technical analysis, we developed over time, have all three basic principles compiled. Analysis starting from the higher time-frames will lead you to reveal of the key breakout, support and resistance level which will give you high probability entries with the low risk (proper money management), but this approach also requires discipline. This three basic principles compiled, should lead to a long-term profitability and it should change your mindset in trading, meaning not to give up after the period of drawdown, and managing your emotions in difficult trading periods and difficult market conditions.

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Through time we have developed a very respectable trading strategy which defines Entry, Stop Loss and Take Profit levels with high accuracy and allows you to make position risk free. We are publishing daily and weekly analysis and 5-10 trade alerts per week directly on your mobile device via Private twitter feed and Private Telegram group!

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