Have you ever had a time getting into a situation?, when losing trades follow one another? You suddenly start to panic., and think, that it never ends? But how strong is this drawdown? Maybe, you just panic for no reason? Maybe, you turn statistical drawdown, which can always happen, into the psychological, what not to do?
Statistical drawdowns need to be predicted. If you are using a reliable trading system, then the law of large numbers is on your side. From the point of view of statistics, there is nothing to worry about in a series of losing trades.. Since a large number of trades gives you a statistical probability of making a total profit. It's okay, to get a series of losses. It's just a matter of probability. If you don't take it personally, and just keep on lying to the system (managing risks), sooner or later everything will change, and the system will return to profitability. However, some traders turn statistical drawdowns into psychological ones.. They indulge in despair and pessimism., start thinking about failure. And thoughts have the ability to materialize. Reality can change, if you think, that ended up in a financial hole. Psychological drawdown is able to make you think, that you are stumped.
It is very important to treat losing trades correctly.. Certainly, you have made a series of deals, who caused losses, but is it worth worrying about this? Not. Successful traders take failure for granted. They don't even lift an eyebrow. They just calculate, what happened wrong, and instinctively try to find a way out of the situation. They can actively study the markets, adhere to the rules of the system and, if market conditions have changed, apply new approaches. Instead of, to panic, traders with the right state of mind, trying with all their might to solve the problem. They don't exaggerate the significance of failure.. They focus on external factors., which can cause price movements, instead of, to blame yourself for losing trades. Instead of, to doubt, they take decisive action and move forward.
Your attitude and perceptions have a powerful influence on how, how do you react to events, such as a series of losing trades. Traders find themselves in a psychological drawdown, when they tend to focus on inner, personal reasons for failure. They attribute failure to their inadequacy.. The opposite approach is very important.. Look not inside, and outside. Look only at the market movement and take action, problem solving, to overcome a losing streak.
Why do some traders blame here and fall into psychological traps? They may be afraid of their inexperience.. Such people think, that they make unprofitable trades, because they lack experience, like established traders. Although this is a reasonable assumption, let's analyze its consequences. Recognizing, that you cannot win back losses and, thinking, that your options are limited, you can opt out of active actions. You stop looking for the right solutions and give up too quickly.. Or worse, you can start making risky trades with a senseless attempt to get your money back as quickly as possible. Instead of this, you need to focus on gaining current experience, ignore the feeling of doubt, keep looking for solutions, move forward.
If you are new, it is quite reasonable to question your talents. Don't forget about risk control and trade above your experience level. But, On the other hand, there is no need to set yourself rigid boundaries. When you are in a difficult situation, we need to get together and start looking for new ways of self-improvement. This can be done, only by gaining experience and trading in different conditions. The more you focus on trading, the more actively you answer calls, the more likely, that you can form that attitude towards the market, which will allow you to win.
