GBPUSD Moves more than 96pips

 

Bullish run from European session up to U.S session opening.

Emotional Intelligence : What It Is and Why It Is Important For Traders

 

Speaking about psychological competences, important for a trader, I would first and foremost single out emotional intelligence. Under emotional intelligence, I understand the ability to distinguish and name your own and other people’s emotional states. Why is emotional intelligence important for traders? I suppose that many traders would like to “get rid of emotions” to avoid losses that emotions often cause. However, such ridding would make a person unable to make decisions. An ability to find your way in complicated social situations that are influenced by the “psychology of a crowd” (and a financial market is exactly such a situation) presumes not only the skill to single out patterns (graphic, statistical) from a mass of data but also to feel correctly the market sentiment. To a larger part, market sentiment is the information unavailable to algorithms (though there are attempts to create algorithms that would estimate market sentiment). Putting things very simply, we might say that the price impulse, spurting from a range and supported by professional demand/supply, will provoke the stereotypical reaction of traders who will try to sell at “inflated” prices. As a result, the trend will further be moved mostly by the emotional reaction of short-term traders who would be closing their positions. A high level of emotional intelligence will let the trader detect such situations and react accordingly. For sure, the main role of emotional intelligence is to detect your own emotions. If a person (trader) experiences some emotional state that they cannot recognize, this might distort the perception of the market and push out some important information. Simply speaking, the trader will start looking for reasons to make a trade (and find them). In contrast to a simple reactive action, when the trader moves the Stop Loss or “enjoys revenge” on the market, the process here is much more complicated and hard to detect. A trader with distorted perception of reality will be sure that their analysis has been objective, accounting for all necessary factors; alas, their attention will be focused very selectively.

Read more at R Blog

About forex scalping

 

Definition of ‘Scalping’

A trading strategy that attempts to make many profits on small price changes. Traders who implement this strategy will place anywhere from 10 to a couple hundred trades in a single day in the belief that small moves in stock price are easier to catch than large ones.

Investopedia explains ‘Scalping’

Traders who implement this strategy are known as scalpers. The main goal is to buy (or sell) a number of shares at the bid (or ask) price and then quickly sell them a few cents higher (or lower) for a profit. Many small profits can easily compound into large gains if a strict exit strategy is used to prevent large losses.

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Scalping is a very short term trading style, and despite its odd name, it is quite a popular trading style among professional traders. Scalping is the shortest term style of trading (even shorter than day trading), and is so named because it attempts to make many small profits throughout the trading day.

Scalping is Technical Analysis

Scalpers are always technical analysis traders (as opposed to fundamentals traders), but they can be either discretionary or system traders. Discretionary scalpers will make each trading decision in real time (albeit very quickly), whereas system scalpers will follow a scalping system without making any individual trading decisions. Scalpers primarily use the market’s prices to make their trading decisions, but some scalpers also use one or more technical indicators (e.g. moving averages).

Scalping Timeframes

Scalping chart timeframes, and the amount of time that each trade is active, are the shortest of all of the trading styles. For example, a day trader might use a five minute chart, and make four or five trades per trading day, with each trade being active for thirty minutes. In contrast, a scalper might use a five second chart (where each price bar represents only five seconds of trading), and make twenty or thirty trades per day, with each trade being active for only two minutes.

Scalping Techniques

As with any other style of trading, there are many different methods of scalping. The most well known scalping technique is to use the market’s time and sales to determine when and where to make trades. Scalping using the time and sales is sometimes referred to as tape reading, because the time and sales used to be known as the tape. Other scalping techniques are similar to other trading styles in that they use bar or candlestick charts, and determine when and where to make trades using price patterns, support and resistance, and technical indicator signals.

Scalping Psychology

Scalping is most suitable for a specific type of trading personality. Scalpers must be very disciplined, especially in the case of system scalpers, as they must be capable of following their trading system precisely no matter what. Scalpers must be able to make decisions without any hesitation, and without questioning their decisions once they have been made. However, scalpers must also be flexible enough to recognize when a trade is not proceeding as expected (or hoped), and take action to rectify the situation (i.e. exit the trade).

To Be or Not To Be a Scalper?

If you are a position trader that uses daily charts, and makes your trading decisions over the course of an entire evening, you are most likely not going to make a good scalper. However, if the thought of waiting several days for your next trade drives you insane, then perhaps scalping would be suitable for you. Scalping can appear easy because a scalper might make an entire day’s profit within a few minutes. However, this is an illusion, and in reality scalping can be very difficult because there is very little room (read as no room) for error. If you do decide to try scalping, make sure that you do so in simulation, until you are consistently profitable, and are no longer making any beginning mistakes (such as not exiting 

 your trades when they move against you).

USD/JPY slips as U.S. tariff jitters spark safe-haven demand

 

USD/JPY slipped lower on Tuesday as renewed concerns over U.S. tariffs and their potential impact on global growth spurred demand for the safe-haven yen.

U.S. President Donald Trump’s unpredictable trade policies have triggered notable dollar selling since April, prompting investors to move away from U.S. assets and boosting the euro, yen, and Swiss franc.

Investors have focused on the potential for easing U.S.-China trade tensions, following Beijing’s announcement last week that it was assessing a U.S. proposal to hold tariff talks.

However, with few details available, investors have been left trying to interpret mixed signals from the White House.

Market focus now turns to the Federal Reserve’s policy decision on Wednesday, where rates are expected to remain unchanged, but attention will center on how officials plan to steer policy amid ongoing tariff-related uncertainties.

Immediate resistance is located at 143.54 (50%fib), any close above will push the pair towards 145.03(61.8%fib).

Support is seen at 142.11(38.2%fib) and break below could take the pair towards  140.23(23.6%fib).

Source : FxWirePro

The Psychology of Forex Trading: Mastering Your Mind for Success

 

Forex trading is a battlefield where technical skills and market knowledge are essential—but without the right mindset, even the best strategies fail. Studies suggest that 90% of traders lose money, not because of poor analysis, but because of psychological mistakes. 

In this in-depth guide, we’ll explore the mental challenges traders face and how to overcome them, ensuring long-term success in the forex market. 

1. The Two Biggest Enemies: Fear and Greed

Fear: The Silent Killer of Profits

Fear manifests in several ways: 

- Fear of Missing Out (FOMO): Jumping into trades too late after seeing a big move. 

Fear of Losing:  Exiting winning trades too early or avoiding trades altogether. 

- Fear of Being Wrong: Refusing to cut losses due to ego. 

 

How to Overcome Fear:

-Trade with a Plan:Define entry, exit, and stop-loss levels before entering. 

- Accept Losses: Even the best traders have losing trades—it’s part of the game. 

- Start Small:Trade smaller positions to reduce emotional pressure. 

 

Greed: The Trap of Overtrading

Greed leads to: 

- Holding Winners Too Long: Turning profits into losses by waiting for “just a little more.” 

- Revenge Trading:Trying to recover losses immediately with bigger, riskier trades. 

- Overleveraging: Blowing accounts by risking too much per trade.  

 How to Control Greed:

- Set Profit Targets: Take partial profits at key levels. 

- Follow Risk Management: Never risk more than 1-2% per trade. 

- Walk Away After Big Wins/Losses: Avoid emotional trading sessions. 

  

2. The Danger of Overconfidence (The Winner’s Curse) 

 After a winning streak, traders often: 

- Increase position sizes recklessly. 

- Ignore stop losses, thinking they’re “unstoppable.” 

- Take low-probability trades outside their strategy. 

How to Stay Grounded: 

- Review Past Losses: Remind yourself that losing streaks happen. 

- Stick to the Strategy: Don’t deviate just because of recent success. 

- Use a Trading Journal: Track every trade to stay accountable.  

 

3. Discipline & Patience: The Trader’s Best Weapons

Why Most Traders Fail Without Discipline 

- Impulsive Trading: Entering trades without confirmation. 

- Overtrading: Forcing trades when the market is slow. 

- Ignoring Rules: Abandoning strategies after a few losses. 

How to Build Discipline: 

- Set Trading Hours: Only trade during optimal market conditions. 

- Follow a Checklist: Example: 

  ✅ Does this trade fit my strategy? 

  ✅ Is my risk-reward ratio at least 1:2?  

  ✅ Am I emotionally calm? 

Automate Where Possible: Use stop-loss and take-profit orders. 

 

4. Handling Losses & Drawdowns (The Trader’s True Test)

 Why Traders Blow Accounts After Losses

- Averaging Down: Adding to losing positions (hoping for a reversal). 

- Tilt Trading: Letting frustration lead to reckless decisions. 

- Quitting Too Soon:  Giving up after a few losses instead of refining the strategy. 

 

How to Bounce Back: 

- Analyze, Don’t React: Review losing trades objectively—was it a bad setup or just bad luck? 

- Take Breaks: Step away after 2-3 losses to reset mentally. 

- Stick to the Process: Trust your edge—statistically, losses are normal.  

 

 

5. The Power of a Trading Journal (Your Secret Weapon) 

 A trading journal helps identify: 

✔ Emotional biases (e.g., revenge trading, FOMO). 

✔ Weaknesses in strategy (e.g., certain setups fail often). 

✔ Patterns in winning vs. losing trades. 

 

What to Track:

- Date, time, currency pair 

- Entry/exit reasons (technical/fundamental) 

- Emotional state (calm, stressed, greedy?) 

 - Screenshots of charts 

- Lessons learned  

 

Bonus: Advanced Psychological Techniques

 

1. Mindfulness & Meditation for Traders

- Helps reduce impulsive decisions. 

- Improves focus during volatile markets. 

- Recommended: 5-10 minutes before trading sessions. 

 2. Visualization Training 

- Mentally rehearse executing perfect trades. 

- Visualize handling losses calmly. 

3. The “5-Second Rule” for Discipline

Before entering a trade, count: **5-4-3-2-1** and ask: 

- Does this trade fit my rules? 

- Am I emotionally in control? 

 

Final Thoughts: The Mindset of a Successful Trader

 

Forex trading is 30% strategy, 70% psychology. The best traders: 

✅ Control emotions (no fear, no greed). 

✅ Follow rules religiously. 

✅ Accept losses as part of the game. 

✅ Continuously improve through self-awareness. 

 

Action Step: Start a trading journal today and review your last 10 trades—what patterns do you see?