Anxiety and fear of loss: how not to succumb to panic and use fear as a stimulus for growth.
Fear of loss is one of the most common blocks for traders. It can manifest as avoidance of trades, premature closing of positions, or excessive monitoring of each candle. But fear itself is not the enemy. It signals importance, uncertainty, and risk. The key is to learn to work with it constructively.
Psychological mechanisms:
1. Fear as protection
The brain perceives loss as a threat to survival, activating the amygdala—the area responsible for fear and anxiety. This triggers impulsive reactions.
2. Psychological pain from losses
Losses are perceived more strongly than equivalent gains (asymmetry effect), leading to irrational actions.
3. Expectation of negativity
Often, traders fear not the loss itself, but the feelings of disappointment, guilt, and shame—the emotional consequences.
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Practical recommendations:
– Accepting risk in advance
Before entering a trade, acknowledge: a loss is possible. If you are not ready to accept a potential downside—do not enter.
– Risk distribution
Fear intensifies when too much is at stake. Reduce your position size to a level where you won't feel anxious.
– Reframing fear
Don't say 'I'm afraid of losing,' but rather 'I'm willing to pay for information.' Any trade is a learning experience, even if it is unsuccessful.
– Writing down thoughts before a trade
Write down everything you feel. This reduces emotional charge and helps distinguish rational arguments from anxious fantasies.
– Positive interpretation
Replace 'loss' with 'cost of skill development.' This helps maintain motivation and reduce pressure.
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Fear is part of the game. But instead of fighting it, it is important to learn to listen to it, understand it, and use it as a tool for increasing awareness and decision quality.