When we are emotional we cannot be logical, when we are logical we cannot be emotional - Page 8
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Thread: When we are emotional we cannot be logical, when we are logical we cannot be emotional

  1. #71
    The accessibility of leverage will entice you to utilize it, and in the event that it neutralizes you, your feelings will burden your basic leadership, and you will likely lose money. The most ideal approach to stay away from the majority of this is to build up a trading plan that you can adhere to, with techniques and procedures you've tried and that result in beneficial exchanges at any rate 50 percent of the time. Indeed, not just should you have a trading plan, however, you should keep a forex trading diary also to monitor your progress.

  2. #72
    It is extremely important for the trader to make his decisions based exlcusively on strategy rules rather than on emotions. Of course, it is almost impossible to eliminate the impact of emotions at all, but it is possible to reduce it. First of all it is important to understand the reasonwhy emotions influence your trading. Sometimes it happens just because trader lacks confidence. In this case he is more likely to act under the impact of emotion making such mistales like closing profitable positons too early, holding losing positions too long or just making emotional trades that violate strategy rules.
    At the same time, if the trader would know that his strategy is profitable and the only thing he needs is just to follow its rules it would be easier for him to be disciplined enough. There few ways to check the performance of the strategy. The simpliest one is to test it manually using demo account. It is most affordable way, but it is very time consuming, while its results are quite often inaccurate. To my mind, it is better to test strategies using special software like Forex Tester to perform backtesting. The main difference of backtesting is that it utilizes historical data. Backtesting process is fully automated, so trader`s psychology would have no impact on its results. At the same time, demo testing is important too, so trader should combine both these approaches.

    Each trader has to deal with emotions in his trading process and there are no easy way to manage with them. Thus, trader should be disciplined enough - in this case, the impact of emotions would be minimized to the lowest possible level. Of course, it takes a lot of time to become disciplined enough, but it is necessary for anyone going to succeed in trading.

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