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Random article: Psychological determination in trading

Psychology is considered to be one of three pillars in trading (along with trading strategy and money management), on which entire success of the Forex operations is based. That is exactly why it is crucial to have a proper psychological determination during trading time by controlling your emotions and preventing interference of emotions into decision making process. Prior to starting market analysis and setting yourself directly to trade, devote some time to a correct determination to work. First of all, give yourself a smile and try to relax. There if no use in a hurry, whereas a positive determination is crucial for trading.

We always hear people saying to control our emotions and trade carefully but we never understand them until we realize what they mean in fact. Below we will discuss this issue in details. Consider an example where we know how emotions lead you to lose: Suppose you have $500 of capital and you are trading. You took a high risk and thus you have lost $200. What finally remained is $300, you get frustrated and open again with an even more risky trade. Again you lose and come to $100. By following the same pace, you will end with zero balance. Let's analyze. You started with capital of $500 and lost $200 with $300 remaining. Your intention is to recover losses immediately and this is what we call an emotion. You have only thought of recovering money and you do not even think whether that situation is suitable for opening a trade or not.

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