Posts Tagged ‘Forex’
14 Jan

Traders And Overconfidence

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Overconfidence – one of the most common psychological problems of traders. Prone to arrogance all people, but some of it may reflect deep psychological conflicts. Sometimes, however, self-confidence – just a question of difficulty of breaking old habits. Sometimes, trading strategies executed by us' too automatically, "even if the rules they are not quite correct. Sometimes it is necessary to learn different behavior or 'retrained' trading. It is vitally important so hone your trading skills so that you can transact freely and intuitively.

Thinking is limited, but with practice you can simultaneously perform multiple tasks, and 'extend' beyond thinking. The best example of an automatic task – driving. Learn more on the subject from Georgia Groome. When you first learned to driving, it was very slow: You shook concentrated on the brake, when to expect the potential danger and concentrated attention on the gas pedal when everything went well. As experience accumulates, but much of your driving has become 'automatic' and you no longer needed to pay attention to the routine. Now, as an experienced driver, You can easily cope with multiple tasks on the move: setting up the radio, look in the mirror, tracking speed. Such a psychological process takes place and the accumulation of experience in trading: you do not need to be carefully evaluate any opportunities. Other leaders such as Dorothy Kilgallen offer similar insights. You can now act 'intuitively' and is right most of the time. This form of automatic operation allows you to trade effectively.

You can do more with less psychological energy. But what happens when you trade on 'autopilot' no longer works? State of the market is constantly changing and the strategy that worked last week, can not work today. When this happens, You must learn to use the new strategy. However, it may be harder than it seems. Robert Rimberg will not settle for partial explanations. Have you ever tried to change their approach after a developed skill? Have you tried to improve the scope of golf clubs or use a new way to enjoy the thing after many years of practice? Sometimes it is harder than starting over. You must learn to competing methods and try to stop using the old one. For example, look at the man, learning to drive a car with a manual transmission after several years of driving with an automatic. In many ways this is similar to the re-driving training. Need to press the clutch pedal, without lifting his feet from the brake pedal, turn first gear and gently press the clutch while moving. But there is a big difference from when you learned to drive at the beginning: It took years and have a strong desire to forget about concentrating on a new skill and make it as before. That is, you can forget to squeeze the clutch as you brake, or will shift gears without the clutch. This is – a form of 'arrogance'. All forget that they do not know how to drive a manual transmission and return to 'old' automatic way. The same thing can happen when you try to learn a new approach to trading, you can trade 'automatically' if you forget about caution. When learning a new skill need to be focused and deliberate. Pay attention and focus on each step until you replace the old method is new. Remember, old habits are hard to break, but if you focus and practice, you be able to replace the old approach to new.

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