Most traders, who open a real account with a forex broker, often faces the problem that was not observed when they are trading on a demo account. Namely, a problem that fear begins to grow occasionally, which eventually become stronger and at some point gets out of control. Of course, in such a state, a trader is not able to earn in the market, and all his actions will lead to a loss or random winnings. Issue is that it is hard to replicate demo account success simply because we may be less worried due to the fact we are trading with “the house-money” – naturally this can lead to some bad decisions too.
We realized that fear negatively affect our trade, but the question remains as follow – how to get rid of the fear? In addition, this seemingly helpful advice like “you need to calm down, apart from trade and follow your trading plan” are difficult to be implemented. Therefore, we need not only advice, but specific actions that will help to resist fear, at any time, even when the market is really hot.
Control Your Emotional State
Each time, before you start trading, write few words about your emotional state. Consider the fact that you trade in different ways, depending on what state you are. For example, if you are tired or want to sleep, it will be one type of trading. If you feel irritability or excitement – it will be a completely different type of trading, even when using the same trading system.
Analyzing your writing after a certain time, you will quickly be able to notice what emotions are most interfere with your trading. For some traders, these emotions include fatigue and depression. For the other – irritation, anger, psychosis and even hysterical. Typically, in such moments, it is difficult to control yourself and calm down immediately. It is better to avoid trading in such emotional state.
For a third group of traders, the main negative emotions are – passion, hope, emotional overload, when trader follows every point in price movement. According to our personal experience, the trading platform is best to open just for a couple of minutes, but no more. If you start to follow the price consistently, then there is a feeling that it is possible to predict. In the end, you realize that price is impossible to be predicted, but you spend a lot of time and spoil the mood.
Keep a Record of Transactions
Some traders do not understand why this is necessary. In fact, it is one of the effective tools to manage your emotions, especially when you open the first real deposit. You must from the first day to get used to the responsibility to yourself. Write down every time your mood at the time of transactions making. At the same time, do not be lazy and write everything as detailed as possible. This, in turn, makes you think over your actions.
You Have to Trust Your Trading System Completely
If you are not sure about your trading system, you will often experience fear during trading. You will always have a desire to switch strategy in the manual mode and start to control the trading in real time. Reason for this behavior is the feeling that you are understanding the market better and therefore it seems that the trade in real time is safer than stupidly follow the trading signals. How can you resist the urge to trade manually?
- Every time when you want to start trading without the system, remember that strategy has brought profits before and it likely will bring them again. Do not be afraid that the trading signals sometimes seem illogical. This is part of an already running system, and it is not necessary to help it. Your trading system is already able to earn on a demo account – is a fact. If you think you trade better than trading system – is just a guess and nothing more. Consider only the facts, but not assumptions, dreams and so on.
- You should examine your trading strategy so that you’ve enter the market, there are no doubts that the strategy cannot cope. Therefore, you must not only come up with a profitable trading system based on historical data, but also examine it in the real market at least 2-3 months.
Use Automatic Trading
If possible, try to automate your trading. Of course, this does not mean that you need to write fully automated trading system immediately. But it is better to automate some things. For this purpose, we recommend you to participate in our recommended BinaryOptionsRobot.com automated trading service.
Review Your Strategy Periodically
Even if you see that you can improve your trading strategy, do not do it under the influence of any emotion. It is better to write the idea in a notebook and keep this record without consideration for some time. Later you can assess the usefulness of this idea more accurately and to decide whether to apply it.
Desire to improve your trading strategy immediately often leads to rash actions. If you accumulate ideas and analyze them periodically, you can really improve the trading system, as it will be more objective assessing the usefulness of a change in your strategy.