Excerpt from: Forex Tips
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| February 24, 2010 | | Trading psychology is the most important aspect of a trader's success. | |
Accepting the risk of each trade is not easy, especially for
inexperienced traders. Of course, there are some steps we can take to
make it easier to accept the risk. First, it is very important to plan
out each trade. This means we should know where we will enter the
trade, place our stop, and place our take profit level(s). That way
there are no decisions that need to be made once the position is
entered. The human brain will view information differently once that
position is entered and it thinks much more clearly before the position
is entered. Additionally, if we know the distance between the entry
and the stop, we know exactly how much capital we are risking. This is
important because it is impossible to accept a risk when we do not know
how large the risk is. After entering the pre-planned trade, emotion
is inevitable, but at least it won't impact the result of the trade.
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| Topic Tags: consistent, errors, even, important, losses, trader, traders, trading | |
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