Trading: An Emotional Rollercoaster

Filed under: Learn Forex Trading |

Like the title says – trading can at times be an emotional rollercoaster. One minute, you’re high because you’ve had a series of good trades and you are in profit. You feel like you’re unbeatable and you really enjoy your trading. Then, a few trades go against you and suddenly you are in deficit for the month. You have to play catch up and you worry about falling even further behind. This is a day in the life of most forex traders.

 

The problem is that when you are doing well, there is a danger of becoming complacent and making trades that are not really strong enough because you feel that everything that you touch will turn to gold. As a result, you make some bad decisions and end up back where you started. Even worse, if you are carrying a loss, you try a little bit too hard and again, take trades that you really shouldn’t. Then you get yourself into even more trouble. It is hard to separate emotion from your trading, but it is something that you must try to do if you want to be a successful trader. You must be aware of your emotions all the time and try to control them. What you must not do is let your emotions control you. The minute you do that, your trading is going to suffer.

 

So what can you do? Well, try writing a trading diary and write about how you feel about each trade (but be honest!). Over time, you might begin to see a correlation between your emotions and your bad trades. Then, the next time you feel something that you have documented before and it has led to a bad trade, simply do not make the trade. Stay away from the charts until you are focused and objective again. Trading will probably always be an emotional rollercoaster  – all we can do, is make sure we don’t get on the big-dipper and stick to the children’s rides.

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