3 Ways to Increase “Confidence” in Trading
It is no secret that psychological factors are very important in trading. More specifically, confidence, aka “confident” is absolutely owned by a trader.
In forex trading, basically confidence is something that is very important. Talking about performance does not mean that the focus is only on trading results, but also on one’s ability to carry out the correct process in every transaction he does. The easiest example is its ability to fight fear and control greed.
A problem that is often encountered is the difficulty of maintaining market confidence when there are drastic changes that cause losses. Then how do you work around this?
Luckily you found this article. Here, we will discuss how to maintain and increase confidence when trading activities, whatever the market situation.
1. Focus on the process, not on results
Every trader would want to make as much money as possible from market movements. But did you know that that’s not really what you focus on?
Basically the market is unpredictable. There is no guarantee that you will know exactly whether the transaction you are doing will result in multiple profits or painful losses. So instead of focusing on profit opportunities or risk of loss, you should devote your concentration to carrying out your trading plan well.
In the trading plan there is a risk limit, there is a capital arrangement, there is also a system that you believe is the level of probability in making a profit. That is complete enough, so think about how to carry out all the plans properly. Don’t need to think about how the results will be, because a good and right process will certainly be followed by satisfying results as well.
Discipline in carrying out trading plans such as patiently waiting for a signal to sell / buy before opening a trading position. Patience may not give instant results, but believe in the end you will enjoy the fruit of patience with a big smile.
2. Practice, keep practicing!
A black belt holder does not get the black belt without serious and consistent training. It is impossible for a karateka to be directly at the black belt level just overnight. He must have gone through years of serious, tiring and often painful exercises.
Likewise with traders. Most people only see the impact of the success of a trader, but they are lazy to investigate what process the trader has gone through. Though it can be ascertained that the most successful trader in the world has ever felt the bitter loss . But years of experience, falling and waking up and constantly developing his abilities can lead him to the highest level of a trader ‘s ability; that is consistent profit.
As a trader, you will never know what you will face in the next five minutes. Traders must practice seriously and consistently so that you are mentally strong in dealing with all possibilities. You will confidently take important decisions even at critical times.
3. Always think positively
You must have heard this phrase: “There is always a positive side to every thing”. Believe that it’s true, at least in the world of trading.
Let’s discuss how to deal with losses like many experienced by traders. Here, we are discussing the cut loss that has become part of the trading plan, namely risk management, rather than the loss that occurs protracted because someone is reluctant to install StopLoss.
Cut loss is certainly a very negative thing, but have you ever realized that cut loss actually saves your “life” from possible losses that are even greater, often infinite? Now, you can see the positive side of the loss just recorded in your transaction history.
The thing you can practice is always to focus on the things you have to do TRUE in every transaction, even when you are experiencing a loss.You can make a kind of “checklist” before making a transaction. For example: “Will there be important data releases? Have I looked at the chart and seen the sell or buy signal confirmation? Have I calculated the risk limit according to the strength of my capital? “And so on.
After you check the list and the results are “Yes”, you should immediately make a decision, do not hesitate. The signal has been confirmed, the risk limit is clear, the potential profit has been seen.So what are you waiting for?