Been trading for a couple years and notice I keep making the same mental mistakes.
Like only paying attention to news that supports my positions or getting way too influenced by what happened yesterday.
What other psychological traps do you guys see affecting your trades?
Loss aversion destroys me every time. I’ll sit in a garbage trade forever just to avoid booking the L.
Anchoring’s brutal too. EUR/USD hits 1.1200 and I think it’s a steal because it was 1.1400 last week. The market doesn’t give a damn about my mental price tags.
Revenge trading after getting wrecked? Account killer. I’ve blown up trying to chase losses with oversized positions. Never ends well.
Sunk cost fallacy gets me too. I’ll keep a dead trade alive because I spent hours on the analysis, even when it’s obviously busted.
Overconfidence after a few wins gets me every time. Start risking too much thinking I figured it out.
Recency bias destroys accounts. You hit a winning streak last month and suddenly think you’ve cracked the code until it stops working. Markets shift but you’re stuck believing recent patterns will keep repeating. Confirmation bias blinds you to obvious exits. You’ll make up any excuse to hold losing trades and ignore red flags that scream your thesis is wrong. FOMO wrecks discipline. You see other pairs ripping and dump your solid setup to chase moves that are already over.
Revenge trading after losses kills more accounts than anything.
FOMO from herd mentality hits me hard. When everyone’s posting about the same setup on Twitter or Reddit, I feel like I have to jump in or I’ll miss out.
That’s usually when smart money’s already taking profits. Following everyone else feels safe but it’s cost me more times than I can count.