What is Trading Psychology?

[cashisking86]

Trading psychology is probably what makes trading one of the toughest businesses in the world. We are often our own worst enemy when it comes to money and this trait is magnified when trading.

 

[Plethora]

Trading psychology is the mental state that tells the success or the failure of the trade.
It is very difficult for traders to develop the right trading psychology. It includes patience, discipline and consistency.

 

[Factualism]

Trading psychology is about how we balance our emotions so that it does not hinder the decision making process. Humans are always driven by their emotions and feelings while forex trading is a profession that requires being rational and logical. That’s why the concept of trading psychology was introduced so that traders can strike a balance between emotions and logic to make wise trading decisions.

 

[Wordplay]

From what you think when you are opening a trading position to how you react in a market situation, all your emotions come under trading psychology. It’s an important yet tough part of your trading career. You better work on improving your psychology so that you can improve your profits.

 

[chocourl]

Trading psychology is a broad term that includes all the emotions and feelings that a typical trader will encounter when trading. Some of these emotions are helpful and should be embraced while others like fear, greed, nervousness and anxiety should be contained. The psychology of trading is complex and takes time to fully master.

 

[Diagraph]

Traders often go through emotions like fear, greed, frustration, hope, regret, overconfidence, etc. But successful traders know how not to let their emotions ruin their trades which is the real meaning of trading psychology.
To improve your trading psychology, you will have to work on reducing the extent of emotions controlling your trades. Have a strong knowledge base so that all your decisions are based on logic and facts. Note how successful traders trade and learn to make smarter trading decisions.

 

[Patrizia Bruno]

The way you react to situations has a major impact on how things work for you in the live trading market. While determining how much to trade, you must also think about how you will deal with the outcomes. The right market psychology takes time to build but once it is built, half battle is won.

 

[Zygosis]

Trading psychology refers to the emotions and mental state that help dictate success or failure in trading securities. Trading psychology represents various aspects of an individual's character and behaviours that influence their trading actions. Discipline and risk-taking are two of the most critical aspects of trading psychology since a trader’s implementation of these aspects is critical to the success of his or her trading plan. Fear and greed are commonly associated with trading psychology, while things like hope and regret also play roles in trading behaviour.

 

[Asteism]

I would say trading is 50% analysis and 50% psychology. So, trading psychology is an integral part of trading success. A trader must be able to make decisions based on logic without any emotional bias. New traders often don’t pay much attention to the concept of trading psychology and this hinders their progress as a trader.