human psyche

Hi,

What do you think: How important is the human psyche, while trading?

Greetings Samir  

Hi Samir,

well, I think trading is mainly dominated by human psyche.
Humans react on news (corporate, ECB/FED-decision, enviromental catastrophes, war and so on). Their reaction can be seen in the chart.

An example:
Fact: A company publishes its year earnings.
You say => Fine, they are better than I expected => you open longs.
I say => that profit was too less => I open shorts or close my longs.

What's your opinion?

Best regards
MrFib  

Hallo Samir,

I agree with MrFib.
One of the main risks for humans in trading is their psychological weakness. There are lots of interesting books written about this theme. It's a kind of never ending story respective never ending learning about yourself.

Wish you a merry X-mas!

Enjoy the days off
007  

Hi MrFibonacci and 007Trader,

I think, it's just like a game of poker. The more you invest the more you can loose and that makes you nervous. You need a lot of experience to stay cool. You should try to act rational and you shouldn't only follow the herd.

Greetings Samir  

The key to successful Forex Trading unlike other financial markets, is knowing yourself. I mean knowing your behavioral pattern under given circumstances, not certainly enlightenment of self... you should know when to quit.

Merry X-mas to all!