Learn Forex: 4 Tips for Overcoming Trading Fears Every Forex trader experiences anxiety and fear. It’s a part of the job. With your own money on the line, you can’t help but feel a bit uneasy. Yet fear becomes troublesome when it alters the way you trade. Typically, traders experience many different fears. They may have a fear of missing out on good trades, or they might have anxiety of losing trades. Either way, trading anxiety can cause you to leave winning trades too early, because you fear that the trend will reverse before it actually does. Or it can cause you to stay in losing trades longer, because you fear letting go of a losing position before it turns around. To be successful in Forex trading, you must learn to control your anxiety. It’s not easy to do, but it’s critical. Many novice and beginning day-traders wipe out their accounts because fear causes them to forget basic trading principles. Here are a few tips for controlling fear when trading Forex:
1. Automate Your Forex Trading Using a trading system or Forex software eliminates emotion from the equation and simplifies currency trading. Software can help you determine entry and exit points, and automation executes trades based purely on the numbers. Therefore you’re much less likely to let emotions control how you trade. One advantage of Forex software is that it can help to manage risk, which is one of the most common sources of anxiety. When you know you can’t risk more than 1 or 2 percent on a trade, you’re much less likely second guess the trade.
2. Brush Up on the Fundamentals Often traders have fear because they aren’t confident in their own skill set. Taking a Forex trading course or attending a seminar is the perfect solution. Depending on the course you take, you will have the ability to learn new strategies and ask questions. Plus, you can also network with fellow traders and develop trading partnerships. With a network of colleagues, you’ll be able to discuss Forex strategy whenever you’re having trading anxiety.
3. Practice Makes Perfect Many beginning traders believe they have to start earning big profits right away. That’s not always the best strategy. As a beginner, you should start by practicing with smaller, low-risk trades. For example, it might be helpful