Here’s something that you need to realize: the fact that you can have winning months means that you DO have it in you to become truly profitable.
From my years of trading, I’ve observed that a trader’s inability to truly make it big in the forex market, more often than not, stems from fear.
I’m sure you know what I’m talking about. After a strong profitable month, ask yourself the following questions:
- Do you feel anxious to trade again for the fear of losing your recently gained forex profits?
- When you do force yourself to take the next forex trade, do you have difficulty sticking to your proven trading strategy?
- Are you reluctant to deposit more money into your trading account even though your past performance indicates that you have the necessary skills to become consistently profitable?
If your answer to most of these questions is “yes,” then I’m afraid that you are forex fear of experiencing FEAR.
Do note, however, that this isn’t your regular run-of-the-mill “fear of losing.” Rather, it is the fear of being stuck and ending up right where you started.
It is the fear of crashing back down, making you think you cannot reach those highs again. After all, the pain can be particularly excruciating if you came from a place where you were doing very well.
How can you get past this fear of losing your hard-earned gains? Here are three steps that might help:
1. Recognize your fears
The first step, like with all problems, is to recognize and accept that the fear is indeed there. Being defensive or in denial will do you no good, as you’ll ignore the problem.
Know that being fearful is nothing to be ashamed about. Like most trading psychology issues, fear is just another hurdle that you need to work on.
2. Remember that trading is a business
Once you accept that your fears are limiting your trading potential, then it’s easier to think of it as a puzzle that you need to solve in order to “unlock” potential profits.
More importantly, getting over your fear will make it easier for you to treat forex trading like the business that it is.See, getting over your fears is not enough. There would be months when you’ll be on a roll and the moolah would keep pouring in. But like every trader out there, you would also experience losses.
Those who haven’t handled their fear would take losses as a sign that they were right to stay in their comfort zones. But if you’re in the trading-is-a-business mindset, then you can accept losses as a cost of doing business and move on to how you can improve your processes.
3. Stick to what works for you
Once you’re in the business mindset, it’s time to capitalize on what has made you pips before. Get back to your basics. Look through your forex trading journal and see what was working for you and what didn’t.
Continue doing what works and change the things that weren’t.
Of course you will never completely eliminate your mistakes, but limiting them and sticking to what initially made you successful will go a long way in helping you cast away the fear.