The FX Bootcamp Guide to Strategic and Tactical Forex Trading

FEAR OF PROFIT

Professionals also must deal with fear, just like novice traders. Not the fear of loss, but the fear of profit. They are worried that they will lose the profit they have with their open trades. It could be a spot trade with 75 pips or a carry trade with 750 pips. The trades may still be technically valid, but out of fear, they cash out.

Some may say that you’ll never go broke taking profit. However, traders have to do the hard work of analysis before making the trade. It’s essential to trust the analysis and earn the pips that are deserved. Leaving pips on the table for emotional reasons is not justifiable. This is especially true for the professional traders who are managing other people’s money.

Novice and professional traders alike can address their emotional fears by planning their trades in advance. This will include entries and exits based on technical analysis of the charts. By focusing on the plan and not the money, fear is reduced. If your plan was to stay in until momentum crosses, do that. Plan your trades and trade your plan. Don’t worry about the money.

Every trade has two limits: one for profit and one for loss. One of these will be triggered and the trade exited. Profit or loss will come from the implementation of your logic, not by reacting to the market or being overcome by fear.