Trading psychology: 4 internal hurdles that affect trading success
These internal hurdles set back personal trading performance
Is trading success determined by nature or nurture? Certainly there are personal traits that are a ‘gift’ to some traders and there are those that handicap others. Good thing is traits are not cast in stone. With determination and help, individuals can modify their own behaviour. (My colleague wrote ‘Internal hurdles on the road to successful forex trading‘ – this is a sequel.)
Internal hurdle #1 – Cannot follow rule
- Act according to personal whims
- Harmful, self-destructive behaviour
- Unable to follow plan
Internal hurdle #2 – Like to catch a falling knife
- Catching low is a phenomenon that happens more often in the stock market among individual investors than in forex trading.
- Cheap can get cheaper.
- Then when price is zero, well it is really really cheap.
If hurdles 1 and 2 are most associated with individuals who have very strong opinion about what they want to do or achieve, the next two hurdles are likely to be associated with followers.
Internal hurdle #3 – Following the wrong crowd
- As we can see from 0:40 – 2:02 if jumping over the cliff did not kill, bravely swimming to where no one has swam before will.
- ‘You jump I jump‘.
Internal hurdle #4 – No conviction
- This one lacks conviction to follow and jump and lacks conviction to NOT follow and jump