Trading psychology in cryptocurrency trading

David H. Weis, Dr. Alexander Elder, and Stanley Druckenmiller remains among the most successful traders when it comes to trading psychology. These legends of forex who have employed the power of emotions and mental state that dictated their success.

Trading psychology is the mental state or emotions which dictate the failure or success in trading forex and securities. Basically, it is the aspect of a trader’s mental makeup that helps in determining whether he/she will be successful in buying and selling currencies for interest. Like knowledge, skills and experience, trading physiology is an important attribute in determining trading success.

Risk taking and discipline are the two crucial aspects of trading physiology, since traders’ implementation of risk taking and discipline is critical to the success of his/her trading strategy. Conversely, greed and fear are two emotional aspects associated with trading psychology, while hope and regret are other emotional behavior that drive trading behavior.

Should cryptocurrency traders nurturing trading psychology?
Like other currency and stock traders, I do agree that cryprocurrency traders need to cultivate positive trading psychology which will drive their success. Among common psychological traders which these traders ought to develop include:

• They need to know their trading limits and avoid over trading.
• Risk management trait which will help in managing their trading capital and attaining trading success.
• Maintaining trading discipline and self control all time
• Acknowledge the difference of not fighting the trend rather following the herd

If trading psychology is the key to trading success of many currency traders, then crypto traders should consider developing and nurturing it.Trading psychology is as important as your trading strategy. In fact, good trading physiology is considered a trading hedge.

Author: Victor Cosmus
Victor Cosmus is a web developer and designer, writer and a passionate musician who loves to travel often. He's worked as a researcher for a number of venture capital firms.

Leave a Reply