Foreign exchange trading is one of the most stressful occupations in the world. Therefore, when trading the forex market it is important to employ forex trading strategies that reduce ones anxiety and stress levels. It has been seen that traders who use forex trading strategies which are indifferent to stress levels engage in more bad trades than good. These individuals will often display levels of mental health difficulties as well such as chronic stress. This article will discuss three steps that a stress reducing forex trading strategy should have. This stress reducing strategy will lead to mental and physical health, thus better trades.
Look at the Different Forex Trading Strategies
One of the more important aspects of any anxiety reducing forex trading strategy is that of the trading system. Trading systems are plans that ensure you make consistent trades which cover all factors of the trade. By having an effective system you will both increase the potential for profitable trading and reduce any stress levels which may be caused by negative trading.
The trading system should cover all aspects of a forex trade. This includes when a trader will enter and exit the trade, the length of trade and whether it is to be a profitable or damaging trade. In some cases the plan may indicate that it would be best to exit sooner than intended or incur losses. By having all this information detailed for you, the stress of live trading is reduced. The forex market is constantly shifting and making last minute decisions without a plan can increase anxiety levels greatly.
Having a Trading Schedule
Many forex traders make the error of assuming they must trade when the market is open. As the market is open 24 hours, 5 days per week, traders become stressed believing they are missing out on trading opportunities. It is recommended that one use forex trading strategy list times to determine when you should trade. This can reduce stress levels greatly as you will have a set schedule of when you should be trading. These set hours will help you organise your life around your trading and reduce anxiety.
Trading schedules can also serve as a tool to ensure you are trading at the most effective times for your currency pairings. Stress of missing opportunities can increase when nothing is happening for your pairings. By trading during highly liquid times will see movement in the forex market and lower anxiety levels.
The trading schedule can be used daily, weekly or monthly. It is advised one avoid monthly scheduling as this is not specific enough to help your trading strategies or reduce stress. It is important to stick to your trading schedule once you have created it. If you do not you will reap no benefits.
Always Having Trading Goals
In order to reduce anxiety levels it is important to have goals. Goals help you stay focused and reduce ‘chaos’ or panicky emotions. By placing structure to your strategy you will identify a pathway to successful decreasing any chances of distraction or stress. However, it is important to remember that these goals should be realistic and achievable. If you are unable to attain unrealistic goals they will only increase stress instead of relieving it.