Panic is one of the emotions associated with trading that trying to combat traders and investors in financial markets. This emotion, it can be characterized as painful and is caused by a sense of imminent danger resulting in a survival response, this regardless of whether the threat is real or just imagined. Panic is a powerful emotion in every human being, when traders start to panic they’ll usually close their positions quickly regardless of market prices.
Speaking of panic as a psychological barrier to progress in forex trading is not entirely true. As in life everyday, panic makes us think twice before making a decision, so he should therefore see the panic during trading sessions. The effect of the panic does not motivate us to practice trading with excess, it makes us believe that what we do is not a good plan.
To overcome the panic, we must be assured that the trading strategy that is used is functional and allows you to be a winner, we need to focus on development. Overcoming panic is not difficult, just think that the trading does not have a chance of history and that it is a separate business. Have total control of his choices and be aware will also allow not to panic.
Panic is a psychological problem, but a trader can easily get rid of force to think rationally, to prepare adequately to the market and study so as to be aware of its aspects and elements that impact . The trading plan and money management should be firm and only based on logical analysis. If our trading strategy is based on purchases and sales of logic, that the percentage of winning trades and very good, the risk-reward ratio is correct and that risk management is strict, so the probabilities for one is winning are in our favor, so there is no need to panic.