Welcome to Day 7 of the 10 days of trading course from BlackBull Markets. Today we will be discussing ‘trading psychology’.

Getting started in forex trading can be quite intimidating. One of the biggest mistakes a new trader can make is by focusing too much on the numbers and as a result, neglecting the importance of trading psychology.

What is trading psychology?

The two main emotions that govern trading are fear and greed. Fear causes a trader to exit a market too early or enter too late, while greed can cause high-risk trades.

Placing trades should be a calculated, methodical process. Therefore, your mental state should reflect this, and you should be calm, decisive, and committed to your decision.

Follow these 6 steps every time you trade to effectively execute trades methodically :

1. See the trade. Find the trade that meets your conditions.
2. Feel good about the trade. It's important to feel good about the trade, otherwise you will have difficulty taking it.
3. Key in the order. Double check your terminal to make sure you haven't made any mistakes.
4. Execute the trade. Press the button to enter your order.
5. Double check your position. View your open positions window and make sure the trade is correct.
6. Fix any errors. If you have made a mistake, quickly fix any errors, even if it means a small loss. Don't hold on and hope. This is critical because you will make mistakes, and it's important to limit their impact.