Trading in Forex and stock markets is not only knowledge and understanding of the fundamentals or technical analysis. Trading is defined by many as an art in itself. Even with a great knowledge and understanding of the market, it is still losing money in mercato.Si can guess that the market goes up and then you purchase, opening a long position. Instead of going in that direction, the market starts to move downwards and comes into the stop-loss, closing the score to a loss making position.
A minute later we see the market go up again, in the way we thought about and analyzed. You end up with a loss in the previous position and now is anxious to get straight back into the market to buy again, because you still have the feeling that the market will continue to rise.
If you continue to stay out of the market and you see the market go up, you might be frustrated about not having found a good time to enter the market, in addition to a loss virtually useless to the previous position.
Emotional feelings such as fear, greed and many times the dependence on trade can simply make us lose a lot of money, even in terms of market knowledge. Psychological factors and feelings greatly affect the performance and the results of the dynamics of the market. And to practice a discipline of an exchange is necessary to perfect for the ultimate success.
When it comes to applied psychology in the world of trading, there is talk of both the mass psychology of traders around the world that our individual psychology. It ‘important to take into account both these methods of psychology, as they interact with each other.