Traders experience a wide range of emotions. It does not matter whether they are just at the beginning of their journey or they are more advanced. The issue is how the traders deal with them. In today’s article, I will discuss the hesitation subject.
Have you ever felt stuck in a moment unable to move forward? Maybe you have opened the trade and then observed how the price went in the opposite direction but you were waiting in the hope it would reverse instead of closing the position? Or maybe you hesitated too long to place trade out of fear of losing?
There was an experiment performed on rats where they were offered either food or pleasure. Can you guess the rats’ choice? They would rather starve than deprive themselves of the possibility of sensation of pleasure.
For traders, pleasure is winning, and losing gives pain. No wonder they tend to have more of the first one and so they are often resistant to take risks. On the other hand, more risk does not necessarily mean more wins. The answer is maintaining the balance.
Tips on dealing with hesitation
Having a plan
The first thing is never to begin trading without a plan. You need to create your method so it responds to your skills and preferences. Having a plan on hand can be of great help in making trading decisions.
Placing stop losses
A stop loss is a tool that helps to protect your balance account. And, in fact, this is the most important thing. I mean the ability to preserve money in the account. Once you can do it, you may start thinking about increasing your capital.
When you place a stop loss, your position will be automatically closed when it reaches a preset level. Just make sure you choose a stop loss that is not too close not too far away. This way it will minimise losses and allow you to secure your profit in a satisfactory amount.
Another thing is your head. This is a place where hesitation problems exist. You can use your imagination to solve them. Do not overestimate the power in you. Imagination will create pictures in your head which in turn will help you to see further.
One helpful technique is to imagine that your position will end in the biggest profit ever. This will shift you into positive thinking. Do not forget, however, that it will not magically change all your trades into winners. You will sometimes lose but try to treat losses as the costs of your business. When you open a position and imagine it will bring you profits, it may reduce fear and so you will not be stuck in a place but act on the signals received.
You can also imagine this is not your trade. Think about it as your best friend is hesitating to open or close a transaction. What would be your advice? Or pretend that a professional trader you know and trust is in this particular situation. What would he do? Imagine, answer and act on it.
Another technique described by psychologists is called affirmations. Repeating sentences such as “I will proceed with my plan”, “I will act on the trading signals received”, “I will place stop loss”. Your subconscious will take them to be for certain after a few weeks of reciting them. And this will help you to shift your attitude.
Pros and Cons📈📉
- 👍 Having a trading plan increases confidence in decision-making.
- 👍 Stop losses help protect your trading account balance.
- 👍 Imagining positive outcomes reduces fear and promotes action.
- 👍 Affirmations can improve your mindset and overall trading performance.
- 👎 Overcoming hesitation requires practice and patience.
- 👎 Balancing risk and reward can be challenging.
- 👎 Emotional trading can lead to poor decisions and losses.
- 👎 Trading success is not guaranteed and requires constant learning and adaptation.
|Fear of placing a trade||Practice with a demo account and use stop losses|
|Hesitating to close a losing trade||Set predefined stop losses and follow your trading plan|
|Overthinking trading decisions||Use affirmations and visualize positive outcomes|
|Struggling to maintain a balanced risk-reward ratio||Develop a clear trading plan and adhere to it consistently|
Trading is a collection of winnings and losings. Both will happen but you can take some actions to strengthen the first ones and minimise the second.
Have your plan ready when you start a trading session. You can test a strategy in the IQ Option demo account to check its efficiency. A demo account is a free option to practice your approach without investing your own money. You get virtual cash and you can refill the account anytime you need it.
Use stop loss orders as they will help you to control the moment of getting out of the trade. It protects from too big losses.
Trading is not only a good technique and applying the right indicators. What happens in your head has also a great influence. Use your imagination and repeat affirmations. Consider each trade as a potential huge winner and treat losses as the business costs.
- Q: How can I overcome my fear of placing trades?
- A: Practice with a demo account, develop a solid trading plan, and use stop losses to manage risk.
- Q: What strategies can help me deal with hesitation in closing losing trades?
- A: Set predefined stop losses, follow your trading plan, and remember that losses are part of the trading process.
- Q: How can I stop overthinking my trading decisions?
- A: Use affirmations, visualize positive outcomes, and trust in your trading plan and analysis.
- Q: How can I maintain a balanced risk-reward ratio?
- A: Develop a clear trading plan, consistently adhere to it, and continually reassess your risk management strategies.
- Q: What role does my mindset play in my trading performance?
- A: Your mindset greatly influences your trading performance. A positive, disciplined mindset can lead to better decision-making and increased success.
GENERAL RISK WARNING
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