Getting to Know the 14 Psychology Levels in Forex TradingAnother important thing to prepare before you jump into the forex industry and engage in various trading in the market is to get to know the psychology levels of trading itself. In other words, try to get to know the psychological character levels that you yourself may experience while trading.

Knowing yourself psychologically in the context of trading will provide an important contribution in making accurate and meaningful decisions in providing profit and influence on your trading account.

In the following trading psychology review, there are at least fourteen levels of trading psychology that will be discussed sequentially here. So, it can help you understand more complexly about the character or emotional situation that you feel. You can also find out how to utilize and overcome this emotional condition so that it does not harm the trading process that you are or will do later. Here is the full review.

Optimis

This first level of trading psychology usually begins with conditions where the market is in a conducive state. Conditions that are calm, normal, and provide very general indications are what often trigger the level of trading psychology optimism. Traders will feel optimistic and positive that conditions will continue to rise. At this level, what is on your mind is usually a strategy to reap as much profit as possible by trading.

Spirit

Next is the psychology level of trading in the form of enthusiasm. As the name suggests, this is marked by a condition where the market chart tends to be dominated by a lush green color. The same thing usually happens with your own portfolio. Expectations of profit are growing. Then, you become more convinced that it is very easy to make money by jumping into this trading world.

Thrill

The next level of trading psychology is thrill. This occurs when the value of your portfolio or account has increased, a condition where you feel disbelief with the results that usually far exceed your initial expectations. At this level of trading psychology, you will become confident, both in your ability to analyze the market, your ability to make decisions, and to bring profit to yourself.

Euphoria

After reaching the thrill, usually novice traders will enter the psychology level of trading euphoria. This level is where you are filled with positive and optimistic feelings, so that it tends to eliminate your sense of alertness. So, it is not surprising if then the market conditions look promising for you. At this level of euphoria too, without realizing it you are in a position with a very high risk of making mistakes. However, most novice traders who experience euphoria often do not realize it.

Anxiety

After the euphoria, it is not impossible that you will make mistakes and lose. You feel that the market is no longer moving according to your guesses or analysis and projections. Here you start to enter the level of trading psychology called anxiety.

At this psychological level, there are traders who can rise, there are also those who tend to make other mistakes that lead to losses and account values ​​that are getting smaller every day. At this point, you usually start to think critically.

Denial

Many fail to cope with their emotions well when they are at the level of anxiety trading psychology. What happens is that they are increasingly convinced that the market will rebound and rise again, this is called the denial level. You refuse to believe the signs that have become error signals around you. In this trading psychology position, many traders start to act carelessly while feeling the rebound. So, they no longer trade healthily.

Afraid

The psychological level of trading denial will change into fear, where you as a trader will be awakened to the real reality of the market. Your high confidence at the beginning will change into a sense of confusion. Uncertainty in determining the trading steps to be taken.

You tend to want to finish quickly and get over this scary phase. In fact, you should calm yourself down emotionally first. Retreating from the market with a small profit will be much better than trading in a state of stress and pressure.

Desperation

At this level of desperation, what happens is a deadlock. You can feel that the profits that have been obtained are gone. For beginner traders, this is clearly a big blow. You could retreat in one defeat. However, you need to remind yourself that losses are part of the trading process itself. Everyone experiences it.

Panic

If you fail to control yourself, you may enter the lowest level of trading psychology, aka panic. You don't know what to do anymore, there is no backup strategy to get you out of trouble. Because in reality, your own account and portfolio are constantly declining.

Capitulation

Not a few traders then give up and exit the market. It could be because you feel that you have lost too much. But unfortunately, usually at this time, it is the turning point for the market to be able to climb again. You can start over again to try to apply a new strategy when trading to reap profits again.

Despondency

Some traders who exit the market will be at this level of trading despondency psychology. They tend to take some quiet time to rest their condition, both financially and emotionally most importantly. This is a good thing, you do not spend time thinking about anything related to the market and trading. Really take a break to think more clearly.

Depresi

While some other traders can immediately dive into the psychological level of trading depression. Not a few end up committing suicide or doing other stupid things. You need to avoid this. Don't get to this level. After taking a break emotionally and financially, take your time to start reanalyzing and evaluating past trading failures. There's nothing wrong with returning to trading with a small nominal.

Hope

These traders who have fallen and finally risen usually regain hope on their emotional and psychological side. This condition makes traders think more clearly and calmly in seeing all the new opportunities that arise in the market. Not reckless, more careful, and tend to be careful in making big decisions.

Lega

At this level of trading psychology, traders finally regain their enthusiasm to gain profit from the market. Optimism can return and you start taking big steps in every trading decision. It is not impossible that the trader's psychological condition will repeat itself back to the cycle from the initial level of trading psychology.

Emotional turmoil and different psychological sides are usually triggered by the uncertainty of the market itself. Especially because of the dynamic and volatile nature of the forex market. For that, you as a trader need to prepare a competent trading strategy too.

Including an exit strategy if you experience losses and declines again when trading. Always remind yourself to trade in a clear state of mind and a more stable emotional condition.

Visit GIC Indonesia to get information about the world of trading. You can also join us in the Telegram Community GIC Trade and Telegram Channel GIC Trade. Don't forget to check the Youtube account GIC Indonesia which is full of interesting information, and follow our Instagram account to get information about various interesting webinars that you can follow.