Maintaining a Cold Detachment when Forex Trading

You will find that there is always a lot of debate about how easy it is to learn Forex properly so that you can gain a constant stream of profits by trading it.

Many strongly suggest that it is relatively simple and that all you basically have to do is to choose the correct trading strategy and you will be assured of success.

However, this train of thought clashes dramatically with historical records and statistics that emphatically demonstrate that there are, in fact, very few Forex winners.

Research into why this discrepancy exists indicates that emotions are one of the biggest problems that traders face. Basically, novices, in particular, let the quality of the trading decisions be negatively influenced by their gut feelings and whims.

This is certainly not desirable because Forex is so complex and dynamic in nature that you must always be in top notch form to generate the correct assessment of a new development very quickly.

You simply do not have the time to hesitate for too long otherwise you could badly affect the timing of possible new trading opportunities. For instance, greed can be very destructive in these cases.

This is because you may feel some attachment to all the cash flying around Forex because you could think that you should be entitled to at least a slice of the action. If you are constantly focusing your attention on and dreaming of money, then this is bound to affect the quality of your trading decisions.

Instead, you need to clear your mind of such superficial thoughts and concentrate in a more scientific and robotic way by analyzing Forex in terms of pips gained and lost.

If you can change your mindset to process and analysis each trading situation with a cold detachment, then you will find that your emotions will not bubble to the surface so often. Consequently, you should discover that your money will take care of itself.

You also need to design or arrange your trading space so that you can minimize all your distractions. This is especially important if you need to monitor your trades constantly over extensive periods of time.

You should also try to keep your trading simple. If you constantly clutter your mind by over-analyzing, then you will not possess the ability to focus clearly enough on key trading decisions.

You must always strive not to overtrade by subjecting your useable margin to intense pressure. If you deploy good money management strategies, then you should ensure that this will not happen.

Otherwise, you will subject yourself to extreme levels of stress and tension that can wear down your resolve as well as degrade the quality of you trading decisions.

How can you possibly maintain a cool front if you are constantly worried that you may be receiving a margin call from your Forex broker? These days the chances of such an event happening are very real because of the very high levels of volatility existing in the current market.

For forex and stock trading...the same things apply if you want to be a good trader!