Forex is a very vicious market place. If you have limited capital and without experience & proper strategies, chances to burn your account is very fast. Most of the participants come in to the market hoping making fast money and turn out losing money fast.
I heard many participants cannot survive more then 2 years, 2 months and even 2 weeks. You will feel comfortable and confidence once you make money. We are human with emotion attached on it. How about when u start losing money? Our emotions will turn opposite and our brain start malfunction. Even experience traders who survive long enough in the market will experience this kind of feeling.
When the market go against me, how do I face it? I have a philosophy when I accept clients and always ask what level of risk they are willing to take. Most of them will leave it to me, I judge their risk based on different type of variables. Anyway, let get back to the topic. Most of the time, I will take a break and hedge the position until I feel comfortable to trade again. I will go out for a drink with my friends and have a cup of coffee or green tea. (Starbucks will be my first choice)
Just to share with you, the last 2 days was a terrible trading days when the big boys start taking profit. It shook the USD/JPY and EUR/USD without any sign of fundamental and TA. The market hit few strong supports. In the end of the day, I call up my buddy and have a chit chat and meet up with some investors and prospects. At the time of writing, the market recover nearly 60-70%.
Even you are the best trader, sometimes you cannot predict accurately when the market will move against you. The only way to avoid it is by applying hedging (for me) and cut losses for certain traders. Both will minimize loses and stabilize your emotions. Trust me, when emotion get rid of reality of your brain, You are finished. Always remember, trading FX is not only science but it is an art too. "What Is Scientifically Optimal Is Psychologically Impossible” -Read my previous articles. http://msfx.blogspot.com/2009/06/is-trading-forex-art-or-science.html
