Anger Management In Forex Trading

One of the very first lessons you learn when embarking on a career in forex trading is how important it is to keep your emotions well under control.


Keeping a clear head is an absolute must, no matter what happens, win or lose, if you’re to continue seeing an overall upward trend… and, if you’re ruled by your heart rather than your head, it’s likely that you’ll see your progress start to falter and before you know it you’ll be on a downwards slide.


But, of course, it’s often easier said than done to stick to your trading strategy and not make off-the-cuff decisions because of something that’s happened.


If you are new to trading, it’s key to remember that everyone struggles with this and you’re certainly not alone, with professional traders also finding it hard to stick to their guns and trade consistently, rather than letting their emotions take charge.


This is where a strong trading strategy really comes into its own. Following the plan and not deviating from it, no matter what, is surely the key to success – even if your heart is pulling you in a different direction. A good strategy is based on analysis and analysis alone, and it’s essential that you trust yourself and the work you’ve put in away from the trading floor.


Unfortunately, when your emotions do start to rise, it can be incredibly difficult to suppress them – especially when you feel that first flash of anger and your heart rate and blood pressure start to go up.


Frustrating outcomes are an absolute inevitability when trading currency pairs and this is something all traders have to accept if they’re to see the successes they’ve always dreamed of. Otherwise, failures will become more and more consistent – and, before you know it, you’ll have abandoned your trading dreams altogether.


Anger is one of the most basic of emotions but it’s also one of the hardest to control. The most instinctive and natural way to express anger is to respond in an aggressive way. This is simply our natural response to threats and stressors, giving us the tools we need to fight and defend ourselves when we feel attacked.


While that’s great from a survival perspective, it’s less effective if you want to see big wins as a trader, so looking into anger management could prove particularly beneficial. The aim of anger management is to help you calm your emotional feelings and reactions, while reducing your physiological responses at the same time.


You need to accept that you’ll never be able to avoid or eliminate everything that causes you feelings of rage and anger, but you are able to learn how to control your reactions… and this will stand you in excellent stead as a trader.


So, with all this in mind, here are a few tips and coping mechanisms you could try to help you the next time you feel that all too familiar flare-up rising up through your chest.


Square breathing


Breathing exercises are really effective ways to calm your mind and give you the time and space you need to gather yourself and regain control of your emotions.

Square breathing is a great place to begin if you’re new to mindfulness techniques such as this. Sit or lie down in a comfortable position, then breathe in through your nose for a count of four. Hold your breath for four counts and then breathe out through your mouth for another count of four. Hold your breath for four counts, breathe in for four counts… and repeat.


Inevitably, thoughts will continue to crowd your mind at first but the aim of this practice is to always bring your focus back to your breath, taking note of the sensations of the air in your lungs and belly, how it feels coming out through your nose, the feeling of it as you hold your breath.


When thoughts do enter your mind, simply acknowledge them and bring your attention back to the breath, without dwelling or pausing overly long on what’s going on in the mind.


As you practise, you’ll find it easier to do this – although it can be tricky at first. Start off with a couple of minutes and try to increase the amount of time you spend doing the exercise, to really help keep you centred and your mind quieter.


Distance yourself


If something isn’t going as you would like, don’t force yourself to stay in the situation, as this will only serve to make you more flustered and agitated – ultimately leading to potentially disastrous decisions on the trading floor.


Take a break, even if it’s just for five or ten minutes, and put some physical distance between you and whatever it is that’s getting under your skin.


If, for some reason, you can’t escape elsewhere, try putting some psychological distance between you and your stressors, looking at the situation objectively by imagining someone else going through it and considering how they might approach the problem.


Write it down


Traders are often advised to keep a trading journal so they can keep track of their successes and failures, helping them analyse their work each day and seeing potential areas for improvement.


Journaling can also be very useful from an anger management point of view, as well, allowing you to express your feelings in a constructive manner… which can be very cathartic, helping you to calm yourself and clear your mind before returning to the problem with a fresh perspective and a new attitude.


Have a laugh


There’s no better way to flip your mood on its head quickly than by laughing a lot. Even if you really don’t feel like it, take a break and find something funny to watch, read or listen to.


Laughter is, in fact, a really effective stress and anger management tool, one that has almost immediate short-term effects. When you laugh, you stimulate lots of the organs in your body, including your muscles, lungs and heart, which increases the amount of endorphins being released by the brain.


Stress responses are also calmed when you laugh, helping your heart rate and blood pressure to drop… leaving you feeling nice and relaxed.


Over the long term, laughter also has a wide range of potential health benefits, including boosting your immune system, increasing personal satisfaction, making it easier to cope with tricky situations, pain relief, boosting your mood and so on.


Do something creative


Expressing your anger is natural and, some might say, essential. You don’t want these negative feelings to build up over time without having some kind of outlet for them, or they could burst out of you at quite the wrong time and in a very unproductive manner.

Channelling your negative energy into some kind of creative endeavour can really help you free yourself from what’s shackling you and holding you back.


Interestingly, recent studies have shown that angry people are actually more likely to be creative, with anger associated with unstructured brainstorming that can help deliver creative problem solving.


Angry study participants demonstrated having more ideas by volume, as well as more original ideas than those who were sad or unemotional… although this benefit was relatively short-lived and only present at the start of the task in question. Over time, the number of ideas all levelled out among the participants.


Painting could be a particularly fun and fulfilling way of expressing your anger and helping you to release any pent-up rage or stress.


Why not keep a set of paints and some paper nearby, so that when you do start feeling the emotions overwhelm you, you can simply take a step back, get the paintbrush out and see what comes out on the page.


Stop trading!


If you’ve been on an upward streak and have enjoyed three consecutive wins in a row, consider stepping away from the markets and taking a break. Do the same if you’ve suffered three consecutive losses in a row.


Prevention is always better than cure where anger is concerned and it’s possible that if you do continue to trade after a series of wins or losses, you could start to make some ill-informed decisions, whether that’s over-trading because of confidence levels or revenge trading because you’re chasing losses.


This will generally only end in disaster and then your anger response could well kick in, leading you to make even more dubious decisions.

Taking regular breaks can help stop this from becoming problematic, allowing you to keep your emotions well under your own control and ensuring that you’re able to continue trading consistently, no matter what.


Do you want to find out more about forex funding? Get in touch with the team here at FTUK to secure immediate funding so you can start earning from day one.

Recent articles


All our funded accounts come with a fixed equity stop out level. Once the account equity level gets below this fixed stop out bar, we will close all running trades and disable trading and access. The stop out level is a fixed value for each funding level, this means that any profit which has been made by the trader increases the loss allowance.

Order in

10% Off