If you want to win long term at Forex trading there is actually a lot you can learn from alcoholics and this article will explain why.
"You can't be a real country unless you have a beer and an airline; It helps if you have some kind of a football team, or some nuclear weapons, but at the very least you need a beer." (Frank Zappa)
A rather amusing quote but be it beer, wine or spirits drinking alchohol, is part of our society. Here we will look at, the addictive nature of alcohol and trading and also, the addictive nature of Forex trading. Here, we will look at the destructive emotions come Into play to stop people becoming sober in terms of drink and non emotional traders in terms of trading currency markets.
Our Emotional Make Up and Addiction
"I only take a drink on two occasions: when I'm thirsty and when I'm not." (Brendan Behan)
Alcohol is a drug and its destructive. Many alcoholics want to stop drinking but fail to do so and if they don't stop, serious health issues or death are the result. In Forex trading many traders want to control their emotions and become winning traders. Losing traders know that deep down, their emotions are dictating their trading but they can do nothing about it. Now trading with your emotions to the fore, won't lead to your death but it will stress you out and you will lose, your money and become yet another statistic.
THE Desire for Short Term Pleasure Over Long Term Pain
"The mouth of a perfectly happy man is filled with beer." (Ancient Egyptian Proverb, 2200 B.C)
"He was a wise man who invented beer." (Plato)
So why can't an alcoholic stop drinking and why, can't a trader control his emotions? The answer lies in the desire for short pleasure, over the reality of long term pain. People think trading is not addictive but it is for most traders. Just like the alcoholic, wants another drink the losing trader wants another trading signal which will win and he will do anything to get it so what does he do?
He will seek the short term high of taking a trade, just like the alcoholic seeks the high of drink and when he gets the trade he wants to make money with it at all cost and also not feel the low of admitting he is wrong about a trading signal. When it goes against him, he hopes it turns around and refuses to admit he's wrong and when he's right, he seeks the short term high of getting a small profit but the losses never cover the profits and the trader losses.
The losing trader, executes trading signal after trading signal, just as the alcoholic, drinks one drink after another but the addiction, while giving short term hope and pleasure, ends up with the trader and the drinker both depressed – what they have both been doing they know is wrong - but they can't stop doing it.
Drunk on the Thrill of Trading But Denial
“I don't have a drinking problem 'Cept when I can't get a drink.” (Tom Waits)
The trader who can't control his emotions, cant control his desire to over trade with his strategy and when he is over trading and letting his emotions dictate his trading and is in a sense of denial that this is happening. The denial can continue for a long time but eventually just like the alcoholic the losing trader can hit rock bottom.
Rock bottom occurs when the trader knows his addiction has to be stopped – there is no other way out but to control his emotions and to start trading his Forex trading strategy with discipline and start looking at the long term benefits this can give. In the case of the drinker its better health and in the case of the Forex trader, its the opportunity to build wealth.
Both the heavy drinker and the losing trader know, the route have to take – there is no one to blame they have to take positive action.
"I envy people who drink - at least they know what to blame everything on."(Oscar Levant)
The trader has to start to control his emotions and if this can be done, then the road to a great second income awaits. Trading for excitement, the pleasure of a short term gain or holding a loss so he doesn't have to look stupid, need to be addressed.
Even though a number of people have tried, no one has yet found a way to drink for a living." (Jean Kerr)
The Majority – Why they Will Never Change and Why You Can
"I keep telling people that beer is more important than armies when it comes to understanding people." (Pat McGovern)
People are emotional and they will try and avoid pain and seek pleasure. The drinker finds solace in the booze, the trader finds comfort in that he “might get lucky” without changing his ways. The losing trader gets both pleasure and pain from trading – the pleasure of the occasional win, the hope, a loser might just turn around and the thrill, of entering the trading signal are the short term high – the long term low is a wipe-out.
When alcoholics give up they know they will always be addicted to drink and at AA meetings the people who have given up the drink say -“ I am an alcoholic”
They may have stopped drinking but they will always, be addicted deep down. They have just chosen to suppress the need for drink - to seek better long term health, emotional stability and happiness.
The good news is you can alter your view of trading and see the markets for what they are not what you want them to be. You need to take your ego out of trading, accept the short term pain of a loss ( which you keep small) reduce stress (by trading less in the markets with your trading system ) and rather snatch short term profits have the confidence to hold them to cover losses.
The above simply comes from getting a good FX trading education and understanding the impact of emotions. If you learn currency trading the right way you, will take short term pain which actually won't be painful after a while because you will know profitable trading signals will cover them. Your losses will be small you wont be stressed from over trading or hoping trades turn around and will be happier and have more money.
"First you take a drink, then the drink takes a drink, then the drink takes you."
You cannot change your biological make-up but you can control yourself. The alcoholic can do it and so to can a Forex trader.
"In wine there is wisdom, in beer there is Freedom, in water there is bacteria."--Benjamin Franklin
I fund the above quote amusing but it certainly isn't the way I would view life or trading. As anyone knows, I am a huge believer in that to trade successfully, you need to be like water and love the Bruce Lee quote on it and you will find articles and video tutorials on this site whcih go into why in more detail. Most people in life and when trading in the markets follow the herd, respond to their emotions, won't take responsibility and never seek the truth – they blot it out.