Accepting loss isn’t easy for anyone. We naturally want to win at everything we do, but is that even possible? It can’t be, because without losses to teach us where we went wrong, we can’t change our system and win the next time around. That certainly fits into forex trading. Losers who get upset can make stupid decisions based on emotion. But those who can smile at their loss and learn from it will go far in becoming a successful forex trader.
Don’t Deny the Obvious
This isn’t about beginning trading with a plan. We’ve gone one step beyond that, and we’re now trading according to our plan. So what do we do when we lose? Maybe you made a mistake and maybe you didn’t. As much as we want to, we cannot control the market. The first thing that many traders do is deny that there’s anything wrong with their plan or their trade. Just watch, the market will turn, they are thinking. So they anxiously sit by and watch, waiting for their deal to turn upwards until it’s too late. Instead of denying that the trade was poorly placed, it’s better to get out while you can. Don’t view the experience as a loss, but welcome it as an opportunity for learning. Study what went wrong and write that in your log. By recording every move you make, you can find a pattern and break it.
Accepting Your Mistakes
We set rules and make plans before we begin to trade, but that doesn’t mean it will be a straight and easy path to profitability. We use our starting point as the beginning of a journey. We can’t know the end until we start at the beginning. And even then, it’s impossible for anyone to know what the market might or might not do on any given day. No one can control the market, so don’t get bummed out that you made a trade that didn’t go as you had expected. Accept it. Otherwise, you will soon be hitting the bottom of your barrel and you won’t have anywhere to go. Record your moves and adjust them between trades, not during a trade.
Make a Quick Recovery
When you suffer losses (notice “when” and not “if”), get over it as quickly as possible so you will have a clear head and a positive attitude to stay in the game. If you are devastated over each loss, it will impact the way you trade. Don’t let that happen. Take time to evaluate how you feel about the loss and if you are too upset to be rational, step away for awhile. Then come back to review what went wrong and how you can learn from it. If you can put the loss in the right light and stay committed to your plan, then jump right back in with a new trade. If you can put the loss behind you as quickly as possible, it will be better in the long run.