Every trader faces moments when -100 appears on the account. It seems more real than +100. Why? Why is it so hard for us to believe in profits and so easy to see losses? The answer to this question is hidden in psychology.
1. Psychological barrier of losses
When you see that your position is in the minus, it causes real anxiety. We are used to focusing on the negative aspects. Losses are like a blow to self-esteem. We start thinking about the money we lost, about what we did wrong. And although +100 can bring joy, there is less emotion in the mind, because the profit seems less important than the loss.
2. Uncertainty in the market
When you are in the red, there is always a feeling that things can get worse and you are not in control of the situation. Traders often get too attached to the current price, worry about falls and forget that the market is volatile. At this time, every step down seems like a disaster, but the upward movement is often perceived as just “statistics”, without strong emotions.
3. The illusion of failure
When a position is in the red, we start to think that it is our bad luck, that we have misjudged the market. We get too carried away with thoughts about what we could have done differently, and this leads to a loss of confidence. A profit on a position is often perceived as an accident that does not require such attention.
4. Attachment to money
We are emotionally attached to money, and losing it is always felt more strongly than gaining it. Psychologically, it is easier for a person to justify a loss than to be proud of the profit received. The task of a trader is to learn to perceive profit in the same way as losses, and not to associate emotions with numbers.
Ultimately, it is easier to see at -100 because it causes a stronger reaction than with a positive balance. But it is important to understand that losses are not the end, but part of the process. The main thing is to be able to work with them, learn and move forward.
