Pressure to Trade
First of all I would like to start by saying that when I first started out trading and learning from other more experienced traders, and to a large degree educating myself on all thing Forex, the opinions of others and their experience and knowledge had a profound effect on me. Just being around successful traders and dedicating myself to absorbing their wisdom accelerated the learning process rapidly.
But there comes a point in a trader’s career where other peoples’ opinions and the pressure to trade along with what everyone else is doing can be detrimental and limiting to your learning experience in Forex.
Forming your own opinion
In my early years of trading I can say fairly safely that not forming my own opinion and getting caught up in what everyone else was doing cost me a great deal of money, and it also took me a long time to learn this hard lesson.
I would like to give you two real life examples of this, both extremely relevant to the point I am trying to convey regarding forming our own opinions in trading.
A friend I went to school with was getting married and he called me up to invite me to his engagement party. I had never met his future wife and he proceeded to telling me on the phone she was the funniest, most sweetest easy going women he had ever met, and a Kate Winslet lookalike to boot.
Naturally I attended the party and met his future wife, and as much as I wanted to really like the person he was marrying I actually found from my own point of view that she was hard work, fairly dull company and regarding my pal’s reference to her celebrity twin, let’s just say he really should see a good optometrist.
Take your own trades
My second story involves some fairly well know traders. I wont name them as they’re trading today and we are still good friends and I do have a great deal of respect for what they have all achieved in terms of a profitable career.
These traders are what is commonly known today as HFT traders (high frequency traders), taking a large amount of short term trades each day based on technical analysis and their vast experience of trading over a series of decades.
When I first met these guys I was very overwhelmed to say the least. They would take maybe 10-15 trades a day and I have to say at the time I was blindly following what they were doing and saying, and not really understanding why I was doing it. I was taking a large of amount of trades just to keep up with the group.
As it transpired over the course of time I wasn’t actually learning anything. Even though they were making money, I really didn’t understand why they were taking the trades they did. I can tell you I found it irked me greatly, and I quit the group in order to self-teach myself, slowly educating myself until I understood how to make money in a way that fitted my personality, and a way that made perfect sense to me.
So hopefully you can see the point I am trying to make here: life is very similar to trading in that we all have different opinions and the way we see things can be totally different. We must therefore form our own opinions in life and have confidence in these opinions. Relating this directly to trading; we must try to learn from our decisions, and not just feel pressured to agree or copy other traders blindly or take tips without thinking about them first.
- Look to fully educate yourself in Forex so you can actually form opinions and analysis
- Avoid the daily pressure of what others are doing around you
- Avoid trading on headlines and what the he said/she said crowd say on social media or TV
- Do not feel the pressure to trade just to be IN the market so you don’t feel left out
- Always ask yourself what YOU think