Trading Psychology
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Are you happy with the results? [info_block align="right"]If you work for the process, you will achieve the desired result, not the other way around. [/info_block] Another calendar year is over and it's a great time to stop trading for a while and look back. This means that you need to be as honest with yourself as possible and answer the question: what was this year for me? Am I satisfied with the work I did and the results I got? Can you honestly say that you've made every possible effort to become a really disciplined, consistent and thoughtful trader, or on the contrary, that you've remained an "overextended Vegas player" all year long? Either way, now is the time to get into the...
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The world of trading is a strange space where the average trader is under constant psychological pressure. From various sources, he is bombarded with information that with the help of some "super indicators", "unique trading systems" and author's trading training courses he can achieve success overnight (or, at least, do it in a short period of time), realize his most daring dreams and financial plans. The main idea of all the messages and promises is that trading in the market will set you free financially, socially and professionally. Trading is you, not the market Many traders come into the market and become obsessed with finding 100%-working trading systems...
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[info_block align="right"]When considering various ways to turn a small amount of money into a very large amount of money, stock trading often seems like a quick and easy way to get rich.[/info_block] Almost everyone who touches the world of stock trading, even on a very limited scale, dreams of becoming a full-time professional trader one day. Making a living as a trader is a worthy goal for many talented and hardworking people, so I like to ask leading questions to hopeful and eager newcomers: Why do they want to make stock trading their profession? What underlies this burning desire? What are they looking for in this profession for themselves? Before you are the most popular answers. 1. Quick millions with minimal investment No...
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Emotional intelligence is the main trader's skill that needs to be mastered in order to succeed. Emotional intelligence is a skill that can be mastered Working as a coach, I came to the conclusion that my main task is to teach novice traders certain principles of work that can lead them to consistently profitable trading. Often I receive requests from ambitious speculators who want, with my help, to find one single trading strategy that will make them successful. Unfortunately, I have to disappoint them. Such a strategy simply does not exist. Successful trading on the market requires, first of all, inner equilibrium and self-control from a trader. Undoubtedly, technical aspects of trading strategy are extremely important, but the factor...
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How often do you get out of your comfort zone? In articles about the psychology of trading it is often said that you need to train your mind to the process of trading if you want to be successful. This means that it is necessary to develop appropriate qualities of character, such as: discipline, honesty with yourself and the market, keeping a diary/journal, making a trading plan, risk management. This means the need to think carefully about trading decisions, based on objective and up-to-date information. However, there is one aspect that is often overlooked, despite the fact that it is now extremely popular all over the world - the need to step out of your own comfort zone. Your comfort zone is...
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When you make the final decision to make trading your main profession, you may encounter some difficulties on this fascinating path that you knew nothing about before. And today I would like to talk about such an unpleasant thing as "emotional burnout". There is a difference between stress and burnout, but both deviations are very dangerous. Burnout is a condition in which you completely lose interest in trading due to the accumulation of constant emotional, mental and physical exhaustion. In this case, it is very easy to fall into a vicious circle. While in this state, you make ill-considered decisions which lead to poor trading results, which, in turn, cause even more...
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This year I visited ShowFx World in Kiev and I would like to tell you about the speech of Tom Hugard, one of the most successful traders in a very large hedge fund. I should point out right away that in this article I'm going to quote his words as I understood them for myself. I've realized once again that success in trading is determined by psychology, not by strategy. It's nice to hear another confirmation of my opinion from the lips of a professional of such a level. *The slides used in this article are taken from the author's presentation. Principles of 2% successful traders The first, most important principle that guides successful traders, is to buy the strong and discount the weak. What is this...
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As a coach I cooperate with a small financial company, a professional participant of the securities market, which, among other things, provides trust management of clients' money. We have one trader, let's call him Mikhail, who for quite a long time showed very good, and most importantly stable results on a mini-account (about 3000 $). He was able to consistently bring his account up to about 5 000$ for a few months, and then withdrew 2 000 $ and started over again, repeating his success over and over again. In the end, we all agreed that Michael has abilities and skills of a trader. After examining his statement, we saw a certain stability: a good equity curve,...
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What is a trading plan, why do I need one and how do I make one? A trader's trading plan can be as simple or as complex as you want. Of course, a plan that is too simple is not informative enough to successfully implement key rules and/or strategies during each trading session. Conversely, if the plan is too complicated, it will be difficult for you to stick to it, and you may eventually give up using it altogether. Therefore, you need to think through the best option so that it is not time-consuming, while being detailed enough for self-analysis. The main task of a trading plan is to keep you calm and relaxed during...
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How to become consistently successful in trading? To answer this question we must first understand what makes millions of traders unsuccessful - what makes them lose money? What prevents them from analyzing the market and placing orders correctly? Why they succumb to fear, gambling and abandon the rules of trading strategy and capital management? In this article you will learn how the science of human brain - neurobiology - explains these processes, what happens on the subconscious level and who intercepts the control of our behavior. What does a trader think? So, let's begin. The first thing worth knowing is "what we think. Where, in our head, does market analysis and decision making take place...
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I recently had a chance to talk to a trader who said he had a goal to increase his trading deposit from 150,000 to 250,000 rubles in about two months. The markets were kind to him, and he reached his goal even a few days earlier than planned. Now he has replenished the deposit, increasing it to 500,000 rubles. Lack of experience - the main problem of beginners His new goal is 1 000 000 rubles by the end of this year. Something tells me that this goal is unlikely to be achieved. The fact is that this guy is a rookie. He got to know the market only a few months ago, and so far...
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One of the key qualities possessed by people who are successful in a wide variety of fields is the ability to take full responsibility for all actions, actions and results, for every step in life. It is well known that only a very small percentage of traders actually become successful. To be among them, you need to work hard - on your discipline and psychology, risk management and trading plan, overcome your fears and greed, learn to manage your emotions. All of this requires an enormous desire, a willingness to keep moving forward after losses, a desire to change your old habits. And this is impossible without learning to take responsibility for the trading process and for...
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In the last article we started talking about a coaching session with one of our Trader's Club members. We talked about his desire to travel and the real need for it. To recap the topic of the session: "What are the traders' expectations from trading in the market and what prevents him from succeeding?" Fears from the outside: Testing brokers without interruption It's worth dividing a trader's fears and concerns into two components: external and internal. We will begin with the external ones, namely the desire to shift the responsibility for the losses to others. We're going to have a dialog with the trader. - What prevents you from being successful right now? After all, you have strategies, you've tested them, they bring...
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In this and the next article we will talk about the coaching session with one of the members of the Traders Club. The topic of the session was "What are traders' expectations from trading on the market, and what prevents traders from succeeding". It consisted of four parts: What goals do you set for yourself in life? Why and what are your expectations from trading in the market? What prevents you from moving forward - what fears and concerns? What do you need to do to reach your goals? These seemingly simple questions, but the problems are already evident at the very beginning. Setting a goal for the trader - half of the success In this case, the main desire of the participant of the session (let's call...
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One of the most difficult things for beginner traders to understand is a different format of earning money, an unstable profit. At , as in business, the money does not come in the form of a salary - every month, the same amount. Here profits alternate with a bad month, and one must get used to it. However, many beginners have these thoughts: "Ah, I earned only 10$ on this strategy, so I won't buy a BMW X6". Or vice versa: "Wow, I have made 130$ in one trade, if I trade a couple of times now, I can quit my job this month". You can lose your whole deposit in such a wave mentality. How ...
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As the unofficial statistics says, only 5-10% traders are successful in making money on the currency market, while the rest 90-95% simply lose their money. What is the reason? Is it because trading on financial markets is very complicated and not accessible for everybody? Or maybe the secret lies in the psychological approach? After all the psychology of people with money and people without money is very different. Let us provisionally divide all traders into two types - "rich" and "poor". The difference between "rich" and "poor" traders Despite the fact that for many people wealth is, roughly speaking", sitting on sacks of money, in fact it is not...
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Подавляющее большинство трейдеров-новичков в течение долгого времени тестируют свою стратегию на демо-счете, приобретая необходимые навыки и набираясь опыта. Рано или поздно начинающий трейдер задается вопросом – а не пора ли начинать торговлю на реальном депозите? Четкого временного шаблона нет, для каждого трейдера это время будет разным. Однако, для перехода с демо-счета на реальный депозит необходимо соблюдение определенных условий. Сложности перехода трейдера с демо на реал В первую очередь начинающий трейдер должен осознавать, что при кажущейся идентичности, торговля на реальном счете отличается от торговли на демо-счете. Для начала, нужно побороть свою неуверенность, однако, при этом помнить, что лучший способ борьбы с…
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На сложном пути к получению стабильной прибыли начинающего трейдера подстерегает множество препятствий. Одной из таких проблем является боязнь пропустить торговый сигнал — точку входа в рынок. Зачастую, новички получают убыток из-за срабатывания стоп-лосса только из-за того, что боятся «прозевать» вход в рынок, сулящий потенциальную прибыль. Погоня за неполученной прибылью от пропущенных торговых сигналов Видя поступление признаков, обозначающих возможную точку открытия позиции, многие трейдеры-новички входят в рынок еще до окончательного формирования четкого торгового сигнала к открытию позиции. Это происходит из-за боязни того, что рынок пойдет в нужном направлении, а прибыльный вход в рынок будет упущен. Очень часто подобные «ранние» входы заканчиваются…
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Unofficial statistics is widespread on the Forex market, according to which only 5% traders succeed in trading. So how to join their ranks? It is very simple - it is necessary just not to do as 95% traders do, but to follow rules, which are followed by profitable 5% traders. What exactly must a trader do to receive stable profit on the currency market? 1. Look for confirmation of a trading signal The more factors that point to buy or sell an asset coincide, the more accurate and reliable the trading signal is. These can be both fundamental factors such as the release of the US Jobless Claims data and the NonFarm payroll report.
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One of my main objectives in my work with traders is to help people understand what trading is in general, what it is a profession, a kind of activity, what are the peculiarities of this occupation. And not just to provide information about how the human psyche works. In addition to all this (of course, this is important material), there is also such a component as "trader's mentality", which, to my great regret, is often neglected. Beginner traders are especially guilty of it. And because they ignore this important component, they will never reach the point in their professional development where they can provide themselves with predictable results in the market. Not to predict market behavior, but to achieve predictable...
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