Which are the psychological habits that sabotage your trading?
What prevents you from reaching your full potential as a forex trader?
If it is your technical knowledge about how to analyse the markets, then there are plenty of solutions out there.
You may choose to educate yourself via free online educational material and tutorials, paid seminars or webinars, personal coaching or assistance from fellow experienced traders.
If your technical knowledge is good enough but you are still having losing trades the majority of time, then there maybe something else going on.
In this section, we outline the exact process by which our thoughts are related directly to our emotions, bodily sensations and actions (behaviour). Understanding this cycle will help you to be more aware of the processes that underpin your decisions.
I would like to invite you to reflect on a recent trading error incident or an occasion where your trading didn’t go as well as you would have wished.
Thoughts: What went through your mind at that time? Did you have any particular images or memories?
Emotions: What did you feel at that time? Was it fear? Disappointment? Regret?
Physical sensations: Which physical sensations did you experience?
Behaviour: What action did you take?
A typical vicious cycle, related to unpleasant emotional states, may look like that:
It’s important to note that every single part of the cycle interacts and influences the other.
Your thoughts provoke certain emotions and those emotions manifest on your body. When you are anxious, you may palpitate or sweat excessively for example. Your thoughts, emotions and physical sensations influence your behaviour and decisions.
Most of the times, the whole process happens automatically, without us having the time to realise which thoughts our mind is creating and not sure about what emotion we experience. We then reach at the “action” (behaviour) almost led by blind forces.
- What are you thinking? Or what is Mr. Mind telling you?
- How these thoughts make you feel?
- What are you experiencing in your body?
- What are you about to do?
- Is your action going to maintain the cycle?