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Fear and Greed | the Ghosts Haunting Traders

killer195175 Posted 21 May in #Article Contest #Risk Management #Fear #Greed #Over Trading #Capital Preservation #Risk Tolerance

15/54

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Hello, my dear fellow community members and my dear readers.
Today I am going to talk about the greed and fear. I am sure that most of you are already aware of these two emotions.

FEAR

Many of us, in fact, all of us have a fear when we are trading in the markets - the fear of losing. But why does this fear arise? when we say that we have no fear of anyone then how come that we have a fear while trading when there is no one around us? Well, the answer to this question is- this is the fear of losing, the fear of losing the money. In today's world money is the most valuable asset. Losing money seems to be losing the very important asset in your life. When we have this feeling of losing something which is very important and dear to have, we tend to be afraid of it. We have a fear in mind. This is what happens in the markets. We don't want to lose the money, but the decision that we made is going against us and we may lose money in the process. This fear shadows our mind and we tend to take wrong decisions in the market resulting in the loss of the capital.

GREED

Greed is another most important factor or the emotion. It is something that we all have encountered. Greed comes into bein…

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“psychology” Key to Success Trading

Sanju777 Posted 2 Apr. in #Trading #Article Contest #Fear #Greed #Hope #Psychology Of Trading #Regret

16/65

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Trading is attracted by more amateurs traders because they thought its easy money but it’s not .
Trading is similar to high thrilling and dangerous sports like sky diving, rock-climbing and scuba diving. if you forget your safety/risk management for a single minute you will hit the rock bottom.
Amateurs dream about earning millions of dollars in short time period without proper knowledge and they will come with their hard earned money and lose most of them. These games provide intense pleasure but it’s like double sided sword it cuts in both directions and many participants ignore the risks and take chances to get lucky but in the long run their luck will run out. Most traders lose because of greed, fear, hope and regret.
An athlete who wants to enjoy risky sports has to follow safety rules. When you reduce the risks, you gain an added sense of accomplishment and control. The same goes with trading.
Successful trading stands on three pillars:
Psychology.
Market Analysis (Fundamental and Technical analysis) and
Money/Risk Management.
I am going to explain about one of the main pillar which is most important for successful trading it is “Trading Psychology” because most o…

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The Biology of Forex Trading

brilliant Posted 23 Nov. in #Fear #Greed #Brain #Dopamine #Biology #Amygdala #Hormone #Testosterone #Cortisol

12/65

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1. Introduction
I still remember my first days of trading a demo account. I was trading without a strategy or a trading plan, just common sense trading and it was successful!
But when I opened a real account the story was totally different as if I became another person. I was not able to exit a losing trade ,rather glued to it in front of my monitor like a deer caught in the headlights, I increased the risk irresponsibly in wrong times, I did revenge trading trying to quickly " make back " the money I just lost...etc.
This article is about you, me, and every trader who suffers the same bad trading habits. It is an attempt to explain, from a biological perspective, why forex traders often make irrational decisions and what can we do about it.
2. The Biology of Greed and high risk
When the trader sees a promising trade, a region of his brain Nucleus Accumbens (NAc) gets activated. This triggers the dopamine reward circuitry. The reward system is normally activated when anticipating something pleasurable or exiting like eating, having sex, listening to music, sky diving ,gaining money, receiving appreciation ,etc. At those moments the feel-good Dopamine hormone is released as a rewar…

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The Ticket of Financial Fall : the Greed.

TRAD3R Posted 12 July in #Trading #Article Contest #Emotions #Greed #Money Management

14/47

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The Greatest part of the emotions that we feel in the trading are is to recognize,
but we hide the avidity very much in deep, so much to leave it to control us.
We fight everyday with this invisible enemy of the Trader, in each operation, base many operative choices on it and fail because of it.
The reason is clear,we do trading because of greed.Be honest,

Whom doesn't interest make money?
Be rich, early and without punch the card?
Maybe someone will disagreed, but the truth is that we are attracted from trading because there is
the concrete possibility to earn more be sit in our room with laptop and internet connection
for some hour at day, who work for a week for someone else (true story).
Let us not deceive ourselves, it's not a game, we aren't at casino,
we no need lucky, no believe fantasy, the dream of trading with iPad on beach in Hawai.
Trading is not for everyone, many never achieve own aspettative, the major part lose own
money and go away.
Trading is like a job and need same diligence,
it need of big mental effort, we have to change our character for the market, not opposite.
The truth Is that almost none born to do trading , statistics confirm it , th…

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Main Reasons for Failure Traders

Forexahollic Posted 15 Mar. in #Leverage #Fear #Greed #Risk #Money Management #Hope #Trading Plan #Margin #Reward #Fail

18/46

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The forex market is the largest financial market and can be accessed around the world, but even though there are many forex investors, only a few are really successful. Many traders fail for the same reason the failure in other asset classes. In addition, extreme leverage - the use of borrowed capital (collateral) to increase the potential return on investment - that is provided by the market, and a number of relatively small margin to trade currencies, denying traders the opportunity to make a lot of mistakes at low risk. Factors specific to currency trading can lead to some traders expect a return on investment greater than the market can offer, or to take more risks.
Certain errors may keep traders on their investment objectives. The following are some of the common pitfalls that can interfere with the forex trader:
1. Not Maintaining Discipline in conducting trade.
The biggest mistake that can be made by any trader is to let emotions control trading decisions. Being a successful forex trader means achieving a major victory after a while suffering from a lot of small losses. Experiencing many consecutive losses emotionally disturbing, and can test the patience and confidence of…

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Greed, Fear, and Stupidity Will Kill any Trader

pipx Posted 6 Feb. in #Forex #Emotions #Fear #Greed #How To Trade

22/45

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Remember the phrase “Greed is good” from the movie “Wolf of Wall Street” by Michael Douglas? Well, it depends on how greedy you are and how you handle your greed.
While we do not froth on the mouths like hyenas or drool like Komodo dragons, we all have some level of greed in us. You might say that greed is what makes us competitive to some extent. However, when combined with stupidity and fear, you will never be a successful trader.
Been in the FX markets since 2009, I have gone through all the emotions as every trader needs to, and to be honest lost 100% of my first real account to stupidity and 80% of my second real account to greed and fear. I am not saying how many demos I have lost. All I am saying is, I should change my middle name to “Margin Call” . Using examples from FX charts, I will walk you through these 3 trade killers.
Stupidity
Stupidity in trading can be defined as doing something you know you are not supposed to be doing. An example is opening a position without a stop or trailing stop or ‘believing’ that market sentiments are wrong. Another case of stupidity in trading is not believing in the market's "self-fulfilling prophesies".
The memory of Black Thursday 201…

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Fear, Greed and Confidence

RobFX Posted 24 Oct. in #Rally #Crash #Fear #Greed #Confidence

18/19

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Fear and confidence are two of the most used words when it comes to the markets. This is no coincidence given that they the two most important drivers of the markets. Whilst trade account for some movement in the markets, it cannot be accountable for the larger violent movements.
Of course if a Canadian business owner needs to purchase materials from Japan the conversation of currency will register within the markets however this won’t be enough to drive price, not in the same way that fear can! Fear can absolutely destroy a market and once it takes hold only the bell or government intervention can stop it.
When George Soros shorted the pound on black Wednesday he did so with such aggression that there was no stopping the pounds collapse and while Soros was responsible for the initial movement, fear soon spread and as people started dumping the pound there was no way to stop it. The UK governments attempt to prop up the currency failed miserably as they simply couldn't cope with the amount of money flooding in against the pound. Eventually the government was forced to remove the currency from the ERM at an estimated cost of 3.3 billion.
One of the most brutal examples of fear was t…

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Surviving in the Long Run by Rationality!

Lincoln Posted 5 Dec. in #Testing #Greed #Freedom #Stats #Traits #Surviving #Rationality #Developing

15/43

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The never ending fight The surviving on market demands knowledge, technique, good traits and avoiding the misfortune. Reaching a satisfying condition demands hard work. All of us need to work on our traits, our strategies needs changing from time to time, or if we developing another method that also needs developing. The destructive effect of greed, what comes from inside of us, media, other people create the need for paying attention to remain loyal to our method. 2 parts of the trading mechanism: First one is the method, the way how we trade, by rules, management, developing it, testing, looking around and so on. Second one is the education, what widen our mind, what controls the way we think, what keeps us developing. The innovation is a treasure, don't drop away such a value. These are the points in that, I am going to post two articles each month, one for trading methods, test and developing them, and a second one for subconscious education for developing. Surviving in the long run! Have you ever heard the phrase that there are as much different way of living as much living soul? Every person have an own personality. How are we linked to one other? By the market! All the pa…

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Kiss – Stress-free Forex Trading

captain Posted 1 Oct. in #Technical analysis #Trading Psychology #Fundamental Analysis #Fear #Greed #Trading Plan #Trading Tools #Trading Education And Knowledge

8/38

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THE KISS STORY Back in high school, our English language teacher told us a story. Many of you may have heard it narrated in one way or the other. It went something like this: A well known public speaker whom we will call Mr. Maneno, was giving a speech at an important event. Twenty minutes or so into the speech, people who were seated next to the speaker’s wife noticed that the she kept blowing kisses at her husband even as he spoke. When the ceremony ended, one of the ladies who had sat close to Mrs. Maneno, approached her and said; “You and your husband must be very much in love.” “Why?” Mrs. Maneno wondered. “I noticed that when your husband was speaking, you kept throwing kisses at him” the lady replied. “Oh that! Well, my husband and I have agreed that whenever he is giving a speech and I feel he is speaking too much or the speech is becoming boring, then I should blow kisses at him. It is coded body language for - Keep It Short Stupid.” KISS IN FOREX TRADING We can apply the acronym KISS to forex trading with another code: Keep It Simple Stupid. The operative word here is - simple. Many of us traders over-analyse the market using all manner of tools to try and find the perf…

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Solutions to Psychological Problems

Gee Posted 14 May in #Trading #Strategy #Psychology #Profit #Fear #Greed #Plan #Emotion #Professional

41/67

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This article is a follow up to the earlier article entitled:

10 Psychological Obstacles to Success

The aim of trading is to trade in a logical, predictable manner with the minimum of emotional conflict. In general, most traders battle with their emotions. Emotions are located in the unconscious part of the mind; to overcome emotions, people need to either use willpower, or to retrain their unconscious mind.

Willpower (or self discipline) sounds like the logical course of action and can be quite successful in the short term. It requires conscious effort though, and this can be draining. Also, if a trader trades because he thinks it is fun, then being disciplined takes away that fun. Using willpower alone is therefore an unsuccessful way of changing a trader’s behaviour.

Changing the unconscious mind so that the emotional drives change is harder but much more successful. It is a bit like changing the operating system on a computer; it is hard going but the computer works so much better afterwards.

The biggest obstacles to successful trading are desperation, the allure of “big money”, impatience, a failure to plan and a belief that the market is conspiring against you.

De…

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The GBP JPY Trade- Obeying Rules instead of Your Emotions

DaddyPapi Posted 21 Jan. in #Emotions #Greed #Rules #Weekly Range

49/65

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This pair was
traded on my real account in accordance with the forecast made a few weeks ago at the turn of the
New Year. As predicted in that forecast, the Japanese Yen continued its
downward trend against the GBP as it did against the Euro and the CHF in the
last few days. Although the trade was successfully executed to generate a
213-pip gain near the 117.70 area, the most important aspect was the discipline
to stick to two of my most important rules –

1. Not watching the trade
2. Exiting at the right target

Since most of
our trades tend to wave towards their respective targets instead of shooting to
them directly, it requires a lot of patience and confidence to leave them until
they are completed. If this is done on a regular basis especially for swing
traders, then success is likely to become the rule instead of the exception. However, because of the emotions that tend to ´get in the way´ whenever we choose to watch our trades or become greedy for more money than the trade can give, this success can become much harder for us.

THE FORECAST

To briefly
review the forecast, the GBP JPY had just broken out of a consolidation pattern
on the Daily Chart to signal th…

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Are Retail Traders Programmed to Lose from the Start?

doctortyby Posted 4 Sep. in #Greed #Traders #Education #Mental #Freedom #Manipulation #Psyhology #Emotion #Fail #Feer

7/94

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FOREIGN EXCHANGE and the other FINANCIAL MARKETS (precious metals, commodities, bonds, stocks, options) may be the ONLY WAY to get FINNANCIAL INDEPENDENCE and FREEDOM in today's ECONOMY... (Financial Freedom means to be able to sustain your living and comfort financial and survival needs, for you and your family - from your current savings, for the rest of your life even if you don't obtain other income from that time on. Ex: if you have 500.000$ in your savings, and your monthly needs expenses are 1000$ , you have insured 500 months, or about 41 years an a half for your current living, if your savings gain at least the yearly inflation to protect them, even if you don't obtain any other income for the rest of your life) Next to Real Estate Market (which has a long time to even start recovering) and Businesses (which are harder and harder to manage because of the law environement and the lack of support from governements for small and medium companies), the FINANCIAL DERRIVATIVES are the best way to keep track with the growing inflation of the world currencies... However I strongly believe there is no such thing as FREE MARKETS (With the PRICE formed freely from the…

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How to Become a Professional Trader

SoftControl Posted 6 Aug. in #Trading #Fundamental #Psychology #Basics #Emotions #Fear #Greed #Mechanics #Foundation

13/73

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How to become a profesional trader The main public for this article is ME, I’m going to re assure the knowledge acquired over the years and will read this over and over again, and maybe you can get some value from this, let’s begin. Are you ready to become a professional trader? What it takes to become a professional trader? Ready to hear the one million answer? It requires 10.000 chart hours, deep patience and study, passion and desire to work hard, practice, practice and more practice, and forget the money for a while, this is a marathon not a get rich quick. Disappointed? I hope not, here I will give you some keys to work hard and get to the next level. Why I say forget the money when the main objective of trading is to make money? Because think in money makes you stupid, shift your focus on the content and not in the process of actual good trading, think in money boost the emotions of fear and greed, the big enemies of trading, if you want to become a professional trader first you must understand what trading is. What is trading? Trading is psychology, yours and theirs. We have all heard the clichés about fear and greed. They rule the markets. In fact, that’s al…

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From Zero to Hero: the Crazy you!

MasterFreak Posted 4 Aug. in #Dukascopy #Fear #Greed #Traiding Psychology #Jforex Secret Trading Money Online

23/73

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The Crazy You!!!....Whom I am pertaining no one but you! or I mean us…All of us….. To be able to understand how things works you must understand how you work. Yah! Confusing right.. Let’s make this easy have ever wonder why someone in a forex forum post his system claiming that his sytem works then suddenly you used it trade with it then fail with it losing all of your capital cursing the trader who post his system just trying to help you out. Remember what I said a while a ago to be able to understand how things works you must understand YOURSELF. The principle behind trading is not merely having a system or a principle or maybe a theory it should be well aligned with your PERSONALITY. A good system needs a great pilot. The Forex world is traded mostly by individuals who have different personality thus Trading Psychology is one of the aspect that we need to learn. We should never fight the market, what we need to do is just to follow the market. One of the most destructive and deadliest sins in this world is GREED. I know it’s very familiar for us to establish this because of our human nature to have everything. Greed sometimes comes out when we …

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Article Library

Fear and Greed | the Ghosts Haunting Traders

“psychology” Key to Success Trading

The Biology of Forex Trading

The Ticket of Financial Fall : the Greed.

Main Reasons for Failure Traders

Greed, Fear, and Stupidity Will Kill any Trader

Fear, Greed and Confidence

Surviving in the Long Run by Rationality!

Kiss – Stress-free Forex Trading

Solutions to Psychological Problems

The GBP JPY Trade- Obeying Rules instead of Your Emotions

Are Retail Traders Programmed to Lose from the Start?

How to Become a Professional Trader

From Zero to Hero: the Crazy you!

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