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Copyrights (c) J. Rhodes

Trading Forex online is easy. Trading is as simple as clicking a mouse button. It’s everything else that goes into trading that is hard. The preparation. Your Forex trading plan. And the hardest thing about trading is mastering your own mind.

Forex trading is 90% psychological. All traders have to dealwith their thoughts and feelings when trading. What separates the traders that make trading a living versus those that are here and gone within a few months is the ability to keep emotions in check and to trade smart.

Where 90% of traders fail is not keeping their mind clear — clear of fear, greed, and ego.

Controlling Fear

You will be wrong many times in trading. That is a fact. But the fear of being wrong can be an 800 pound gorilla, especially if you are trading with money you need. Never trade with what is called scared money. This is money that could be used to pay your bills.

NEVER take that money away from your family. Only trade if the money will, in no way, affect your standard living. If you trade with “scared” money, you will make bad decisions and eventually fail.

No only can fear can keep you from trading at all, but it can cause you to make “revenge” trades. These trades are also called stupid trades! You lost money in a trade, now you are both angry and scared that you need to make that money back. Control those emotions!

Controlling Greed

You will experience this emotion. You will have a number of trades in a row that are all winners. Now you are trading with the green monster called greed. Hey, you made a bunch of money in a short amount of time with 1 lot, why not just do the same thing but with 10 lots? WRONG!

You may make a few trades in the positive, but in the long run, the little green monster called GREED will take back what you made and, most likely, even more — causing you to be negative overall.

Greed is very hard to control, especially with multiple Forex trading wins. That is why having a trading plan is a must. Set up a goal of not only what your loss-limit is, but also what your daily profit goal is. When you hit your goal, stop trading real money. Instead, switch to a demo account and paper trade. Use this time to practice.

Controlling Your Ego

Greed and ego, for the most part, go hand in hand. As with multiple wins, you start to feel unbeatable. And as with greed, your ego will be your downfall.

Become too cocky, and the market will be happy to give you a big slap in the face. There is nothing wrong with being positive about your trading, but do not let yourself become overconfident.

To be a professional trader and stay in this business for any amount of time requires you to constantly battle your inner self and stay grounded.

Remind yourself daily to treat the Forex market with respect and to thank the market for the education you received (i.e. losses), keep a positive attitude, and you are well ahead of most traders!

RECOMMENDED READING

• Forex Trading Online Help
• The Basics of Trading the Forex Market: Terminology
• Forex Trading Online (free help)

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