Having Trouble Pulling the Trigger on Forex Trades?
Overtrading is a
Laziness seems like a laughable reason to miss a trade, but it is a real thing for many traders. It usually goes like this: "Looks like a nice trade setup. Need some more analysis to confirm. Oh... I better go do some
The main effects of being afraid to pull the trigger on trades are rather obvious:
Missing good trades. The most serious consequence is that you stop making money from the trades you would be scoring had you not been
A strategy bias. Skipping some trades means that there is now a bias in your trading. You might be unaware of the factors that make you reluctant to take a particular trade, but in the end, you will see that the diversity of your strategy has suffered and there is now a bias, which can practically kill the effectiveness of the system. The simplest example is the currency pair bias because you are now afraid of taking trades in some particular currency pair after experiencing a series of red trades there. Trading systems depend on diversity — removing one pair from such a system can undermine its performance.
Further emotional downfall. Seeing a missed trade run to a profitable end will inevitably lead to frustration. At the same time, noticing that overall performance did not get any better from extra hesitation will add even more emotional stress. Eventually, more losses will follow, creating a vicious cycle that will call into question the whole idea of trading Forex for you.
What to do?
Fortunately, there are three simple steps to remedy the disinclination to take some trades:
- Find the reason. You should start by analyzing the recent change in your trading style, specifically at the
pre-tradingroutine. Try to understand what is causing the unwillingness to take the risks. Is it plain laziness? Is it some big streak of losing trades? Are you spending more time on analysis than you have to? Or is it something else?
- Take a break. Stepping back from trading is a much better option than continuing to
half-tradewhile questioning your every decision. Spending some time away from the platform and charts will calm your mind and will help switching your attention to really important things upon return.
- Reconsider your priorities. Try to look at the process of trading from a different angle — switch your priority from earning profits to following a profitable system. Ignore the losing streaks, disregard big losses, just follow the system. If it is a sound system, it will pay back eventually. It is a crucial psychological step to successful trading — understanding the importance of executing a strategy rather than chasing profits.
If you want to share your opinion on how to cope with trigger-shyness in Forex trading, you can do so on our forum.