Top 3 Psychological Trading Mistakes
Making mistakes is very common in human nature. No matter how conscious you are, you will make mistakes. When you were a child making mistakes didn’t cost you anything rather than getting scrolled by your parents or elders. But as you start to grow the consequence of your mistakes started to cost you something. In trading, making mistakes will cost you losing your money which you earned or managed by doing very hard work. As a fulltime trader in Australia, you will always lose some money. No matter you make mistakes or not, you will lose money. But if you make mistakes, the losing amount might affect your trading balance. Greed and fear are the most common psychological problem that a trader face and these the main key reason why traders make odd decisions as no one can imagine. In this article, we are going to talk about 3 mistakes that a trader does because of his psychological condition.
Trying to grab all the signals
When you are a trader you must need to be very calm and quiet because trading is not a place for louder people. Some traders always have a fear of losing an opportunity and it is not a bad thing because you should refuse any opportunity. But you think every signal as your big breakthrough in trading and as a result, you try to open position in every opportunity then that might be a problem. This type of psychological imbalance can lead you to open trades in a much higher lot than your account can cope up.
As a result, they hurt their account very badly. So when you are trying to make a career from trading avoid the hype of what people saying about the market rather than just trust in your trading strategy. No matter how hard you try you will miss many opportunities and trust me it is not a bad thing. Because you will also find plenty of opportunities but you just need to find the best one and make the most of it. But for that, you need a reliable broker like Saxo. Visit their website here and learn more about premium trading environment. Here you can check the Scam recovery companies blacklist.
In the trading market, greed can be considered is overconfidence. Being confident with your strategy when you are winning trade is a natural thing and everyone will appreciate that. But continuous winning may lead you to become overconfident and trust me when you become overconfident once then your bad trading days will start. You will be so biased with your strategy then you will ignore other variables that might affect the market and as a result, you will face loss. Even overconfidence can lead you to not using any take profit and stop loss level. Overconfidence is the worst enemy of the trader. An investors should always consider what might go wrong if he is not alert enough and what being overconfident could lead him.
Revenge trading can be considered as recovery trading and it is quite natural when you lose the trade. You might look for some opportunities from where you can recover your loss. But if you have an intention like you want that money back in from my next trade or in an hour from this market then it will be a problem. You are not recovering the money rather than you are just taking revenge from the market and which will lead you to lose more money. So never be desperate when you face any loss because as we always say that you will lose money in this market no matter how good you are as a trader. Remember that desperate situation calls for desperate measure and which might not give you a positive result always.
So, avoid this type of psychological problem when you are in the trading world and you do not want to lose your money by making mistakes like this.