What is anxiety?
According to heathline (a health blog) “Anxiety is a feeling of fear you have when you do something stressful”. We can further, say that anxiety is “an unpleasant state of mental uneasiness, nervousness, apprehension and obsession or concern about some uncertain event”.
When a forex trader opens his trading terminal (MT4, CTrader etc.) The market looks calm and easy going to him. When he summons enough courage to place his position on the market, at that very moment, it seems the market just got ignited. Everything starts to move rapidly, the ups and down becomes something else without a reasonable explanation. For a moment, he (the trader) begins to think that he had made a mistake to enter the market early or probably too late.
At this point anxiety creeps in; this is the same experience most traders pass through almost on a daily basis.
Anxiety can deliver a deadly blow on forex trader’s psychology “read how to survive in the forex market” and if not properly checked can cause depression and affect one’s self esteem on a long run.
Since we all know what is anxiety, let’s see how it can affect our performance in forex trading.
How can anxiety affect your trading?
Anxiety can keep you in an unpleasant state, a state of self-doubt, self-denial and can cause stress which will in turn increase your blood pressure. The ugly truth is, almost, if not all traders passes through this feeling at least once in their trading career.
Have you ever made a loss for 3 consecutive times? At that point what happens to your self-confidence? You start seeing yourself having doubts, asking questions such as “is forex profitable, can I make money from this trading, is the market/ broker trading against me” at this stage many people end up quitting because they are concern that they aren’t going to make it.
Let examine possible ways which we can reduce this anxiety.
Over Coming Anxiety Include:
When was the last time you placed a trade on the market and keep staring at the chart? Secretly wishing for the trade to go in your favor? I have said this before that no matter how hard you analyze or predict the market, it will surely move in the direction it wants to move and not the direction you want it to go, you can be lucky to be in the same direction with it – if you are patience and anticipate right.
Staring at the market’s chart only increase your thyroid level, this is a hormone associated with anxiety. The market doesn’t move in a straight line. As such, price might go up in your favor by some certain pips and then go against you for hours if you are not lucky as they say, it can range for days –you don’t need to worry if your stop-loss is in place.
This is why I always tell my student to look at the larger picture which is the daily or other higher time frame such as the weekly. This will enable you to see, gets and understand how the market has been moving for a longer period of time –which will help in plotting stronger support and resistance level.
Once you are done with analyzing the market, place your trade with your take profit and stop loss then calming close your trading terminal (MT4, CTrader etc.) Followed by your computer or phone, this is simply what I do –shut everything off, the worst that can happen is your stop-loss or take-profit being hit, which is better than being obsessed with the trade.
Get a Hobby
Every business man/woman has a hobby. Something they do when not in office or when not wearing a suit and a tie. Forex is not left out, as a business “every forex trader should get a life outside forex and trading”. You mustn’t sit down all day starring at the charts to get the latest tick price or reading the popular news about the market.
In all, you should always go out for a little exercise to keep you healthy and physically fit. Talk to your friends to build your confidence. Every morning as early as 6 am, I go for a early morning walk, it helps to keep me physically fit and well as keep my mind free from stress.
In summary, understand that anxiety doesn’t always result from trading forex you can be nervous, stress out from other things too such as work, family and heath related issues.
But regarding this article we talk more on the aspect of forex trading and there are a lot more that can contribute in increasing anxiety in forex traders such as trading with large lot size. Trading with a larger lot size means that if the market moves a certain pips against you the loss will be much, unlike when trading with a small lot size and without enough free margins (money in your trading account) this is another way to watch your money burn.
Over trading, revenge trading, poor money management all these have increase the mental uneasiness of trader, making traders to think a lot and be stressed out, nobody is happy when losing money but we should learn to earn more than we lose to the market and keep our minds at peace.
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