In this article, I will try to approach the negative feelings that many traders face when they immerse themselves in the trading market without training myself to accept sudden market changes.
Below we summarize the most important dangerous emotions that negatively affect the trader’s psychology:
1- Fear: By this we mean exaggerated fear, and it occurs during the decline in the price of a particular currency or when corrections occur. This is a normal thing, but in such cases the novice trader experiences a state of panic and makes the decision to sell at a loss.
2- Greed: By this we mean the psychological state that a trader experiences when the price of a certain currency rises, but he desires to make more profit, and soon the market turns, and the price suddenly drops, so the trader in this case loses the opportunity to profit and may sell at a loss.
3- FOMO: FOMO is an abbreviation for the English phrase: (Fear of missing out), which means the fear of missing out. This state occurs to the trader when there is great momentum to buy a certain currency, so the trader feels a psychological state that tells him that he will miss this opportunity, so he enters with The herd thus buys at the peaks, and this is a big mistake, as the market quickly turns, and the price suddenly drops.
4- Ecstasy: This is a psychological state that a trader feels when he achieves profits in successive deals. He feels a kind of euphoria that resembles the euphoria of a drug, so he continues to enter into other successive deals until he enters with all his capital and thus loses everything.
5- Recklessness: which is entering into deals hastily without study or research. This condition affects people who seek guidance from others, or resort to applying ready-made recommendations without prior study.
6- Frustration: This is a psychological state that a trader experiences when he enters into several losing trades in a row. He feels a state of psychological frustration, which prompts him to make incorrect decisions. This might put him in a state of revenge.
7- Revenge: This is a psychological state that afflicts some traders. When this type loses in a particular deal, he seeks, without analysis or thought, to enter into another deal to compensate for the loss and take revenge for his first mistake. He loses again, and a second, and a third time, until he spends all of his capital, so he has taken revenge. From himself and punished them subconsciously. This type must be trained to benefit from his mistakes by analyzing them and finding out their flaws so as not to repeat them again.