Trading Psychology: Missed Trading Opportunities

When a trader misses a profitable trade, they may become frustrated by their greed.

To avoid this frustration from turning into revenge, traders can use price alerts and limit orders.

As traders, we struggle with a variety of emotions every day. However, most emotions are inevitable when trading, simply because we are all human. But if we fail to manage them effectively when trading, they can have disastrous consequences for our trades. Below, we will explore in depth how greed when trading and frustration when missing a trade can affect us, and how we can avoid this from happening.

We've all experienced regret and frustration when we miss a trade - mainly due to our greed for missed profits. Therefore, we need to tell ourselves at this time: it's better not to make money than to lose money, and we need to keep the green mountain for fear of running out of firewood. For many traders, if they don't respond to this greed in time, it can lead to revenge. Once traders feel revenge on the market, their trades can become a mess because they may stop focusing on trading strategy and keep increasing leverage just to make back the money they lost.

For example, if the AUD/USD pair on the chart below were to rise above 0.7778, there are two ways to avoid that.

price alert

Price alerts can help us overcome the fear of missing a trade. If you want to know how the price will move after technical analysis (e.g. support and resistance levels, Fibonacci levels, Donchian channels), then price alerts will be your best partner. Price alerts can be set as audio alerts, or via the trading platform to set up an email message for reminders.

Limit Order

Using limit orders is another way to help avoid missing trading opportunities. Limit orders allow us to set a suitable entry price based on our trading strategy. When the price reaches our ideal level, the system automatically executes our order. Limit order setting is relatively simple: you just need to click Buy or Sell and enter your ideal price level. You can also set limit and stop loss points in the advanced options.

No matter which method you use, price alerts and limit orders can help you avoid missing out on trading opportunities. When the price reaches the right level, we receive notifications or the system helps us execute pre-defined trading strategies. As a result, what was previously seen as a trading stumbling block has now become a profit opportunity!