What Is the danger of perfectionism in trading?

27 May 2024
You don't need to be perfected to trade profitably

In the early stages of a trader's trading career, striving for perfection can play a cruel joke. What was the reason for that? For traders who struggle to admit their mistakes, even small losses can quickly snowball into larger ones. This is because perfectionists have a hard time accepting defeat. In addition, the trader may tend to secure a profit prematurely in order to experience a sense of victory. In this article, we will talk about the dangers of perfectionism and what to do with the unpredictability of financial markets. We will also tell you about five ways that will allow you to trade profitably and not always try to control the market.

What Is the Danger of Perfectionism in Trading?

Perfectionists hold the belief that being accepted by others necessitates achieving a state of perfection. It's important to understand that acceptance cannot be achieved solely through performance or external factors such as wealth or social validation. Instead, finding contentment within oneself is the key to experiencing true joy. One of the biggest challenges traders face is the fear of not succeeding.

If you approach trading with a perfectionist mindset, you are setting yourself up for failure. It is inevitable to encounter losses during your trading journey. It's important to approach trading with a perspective that acknowledges its probabilistic nature. Being overly fixated on perfection will hinder your ability to excel as a trader. The losses you're experiencing, which you're hoping to recover, can be incredibly challenging to handle. If one is unable to accept a slight loss due to the desire for perfection, the loss will likely escalate into a much larger one, leading to additional distress for the trader who strives for perfection.

The goal should be to strive for excellence in trading rather than aiming for perfection. Furthermore, it is essential to seek exceptional performance consistently rather than expecting every single trade to be excellent. Successful traders understand that making mistakes is inevitable, but they can minimize the consequences of those mistakes and maximize the potential of their best strategies. Seeking the assistance of a skilled professional may be crucial when it comes to transforming deeply ingrained behavior patterns and personality traits. Changing long-established habits, beliefs, and traits doesn't happen overnight, but acknowledging a problem is the first step.

Here are some suggestions for those who want to reduce their perfectionistic tendencies:

  1. Learn to value the journey as much as the result - establish more realistic objectives.
  2. Recognize your inherent worth, regardless of the outcome, whether it be a victory or a loss on any given day.
  3. Shift your focus from achievement to enjoyment - you might be pleasantly surprised by the positive results that follow.
  4. Instead of being overly critical of your mistakes, try to view them as learning opportunities.

Refrain From Discovering the Flawless Formula for Predictive Trading Strategies

Every trading strategy has limitations, and no strategy can guarantee flawless results, period. Keep repeating that to yourself until it becomes ingrained in your mind. No matter what experts or educational programs may claim, it is essential to remember that there is no flawless trading strategy.

There is no such thing as a flawless trading strategy, as real-world factors influence every action taken in the market. The information is presented solely in the form of charts and displayed as a collection of numbers and data based on specific rules. The fact is, it's genuine, dynamic data recorded from actual markets.

In this particular reality, one should not anticipate events to unfold in predictable patterns or adhere to a rigid formula that would provide a definitive explanation for everything. There is no definitive solution for every situation. Trading, like anything else in life, operates similarly. Prepare to be constantly amazed by the multitude of factors that contribute to the present situation. It is unrealistic to anticipate that various aspects of your life will effortlessly fall into place or that issues will be resolved instantaneously.

The Forex Market Is Known for Its Unpredictable and Chaotic Nature

Many people have a common misconception about trading. Some individuals approach the market with the belief that it can be effectively navigated using essential tools such as trend lines, trending channels, chart patterns, candlestick patterns, and indicators. All of these tools provide mathematical interpretations of the market. However, with the mathematical aspect, the market appears more predictable and disorderly. That's because it arises from the convergence and interaction of numerous driving forces. It's impossible to anticipate such a whirlwind of activity accurately.

Consequently, it is unrealistic to anticipate possessing a flawless formula for a predictive trading strategy. Refusing to acknowledge this reality will ultimately result in disappointment when you come to terms with the fact that it is unattainable.

Regrettably, numerous educators make bold claims about their ability to forecast and predict the market accurately. Exercise caution when encountering these educators, and be prepared to sound the alarm. Steer clear of this kind of education as it is entirely detached from reality. Caution should also be exercised when using software that claims to handle complex tasks on your behalf. The software's scanning capabilities are limited to code-specific patterns or combinations of events, making it unsuitable for the adaptability required to navigate a market that is constantly changing.

Embrace and Confront Your Trading Emotions

Numerous experts and instructors have addressed this topic by advising their students to disregard the psychological aspects of trading. They promote a trading approach that emphasizes robotic precision, ignoring the human element. Here's another perspective for you - this approach seems highly challenging. Attempting to evade these emotions will only lead to complications. Instead of rejecting our emotional side, we should accept and master it. We must discover methods to collaborate with this elusive element, as complete eradication is not feasible.

Developing a solid strategy to manage emotions is crucial for effectively navigating the complexities of human experience in both personal and professional realms. Gain valuable insights and develop the ability to effectively manage your emotions while engaging in trading, using the knowledge and experiences you accumulate throughout your life.

Another approach to managing your emotions, as recommended by professionals, is to consider utilizing automatic trading or expert advisers. Several vendors recommend this solution as it implies a lack of emotion when executing automated trades. This is a misconception, though, because the market never operates according to fixed patterns. It is essential to keep in mind that even when patterns seem apparent, they are constantly evolving with subtle variations that can significantly impact the outcome and algorithm you are dealing with. Thus, relying on auto trading may not be a practical approach to address the mental hurdles you face in trading.

5 Tips to Stop Chasing Perfection and Controlling the Market

Here are five valuable insights that can assist you in relinquishing the desire to control the market:

Understand What You Can and Cannot Control

Some traders attempt to micromanage every aspect of their trades, which often leaves them ill-equipped to handle a trade that rapidly goes against them or one that narrowly misses their profit target before reversing. These are just two instances that highlight the outcomes of succumbing to fear and attempting to exert complete control over one's trading activities.

Firstly, it's essential to refrain from seeking complete knowledge on every subject. It's impossible to have full knowledge of all the factors influencing market fluctuations. However, understanding the reasons behind market movements is a challenging task. However, we can rely on past and present data to form various price action strategies. By doing so, we can create a foundation to anticipate potential future developments. However, it is crucial to realize that consuming an excessive amount of trading news or spending countless hours analyzing charts will not provide you with the insight needed to predict future outcomes. It is impossible to predict the future with certainty, as we can only speculate on what may occur. Keep in mind that our approach in the market is based on the probabilities of our trading edge rather than relying on absolute certainties.

It is only possible to predict with absolute certainty what will occur in the market once it actually happens, leaving little opportunity to capitalize on it. The goal of traders is to make steady profits in a market where results can be unpredictable. This can be challenging, especially if we haven't fully embraced the fact that outcomes will not always be consistent. Nevertheless, it is possible to generate income through trading as long as you refrain from excessively micromanaging every aspect of the trading process and attempting to manipulate the market. Many individuals find themselves entangled in this aspect when trying to manage their trading, businesses, or even relationships.

Attempting to micromanage every aspect of our work, trading, and relationships often leads to unintended consequences, resulting in heightened levels of stress and anxiety.

Once you grasp the concept of relinquishing the primal instinct to manipulate the market and excessively oversee every minor aspect, under the false belief that more information equates to greater control over your trading results, you will embark on the initial stages of adopting the correct trading mentality. Achieving success in trading largely depends on cultivating the right mindset and using it to guide one's actions in the market. By establishing effective routines and turning them into ingrained habits, traders can enhance their performance. Once you have a firm grasp of your abilities, you will start to notice significant enhancements in your trading performance over time. While it may seem like a common saying, it is undeniably accurate.

Create a Well-Thought-Out Trading Strategy and Stick To It

Indeed, it is a joint trading phrase to emphasize the importance of carefully strategizing and executing trades. Nevertheless, if you possess a straightforward trading strategy that you adhere to without fail, then you are well on your path to achieving trading expertise. It is crucial to incorporate rules into your trading plan that discourage overthinking and micromanagement. Make it a habit to review this plan before analyzing the markets each day. Additionally, make sure to allocate some time apart from the markets to allow yourself the opportunity to reset and regroup. It's essential to establish a structured daily trading routine to avoid spending excessive time and energy constantly monitoring every potential market factor. It is important to focus solely on your trades and the market when analyzing the charts. If you find yourself excessively preoccupied with other matters, it may indicate that you are overexerting yourself.

Furthermore, if you persist in excessively controlling your trading to the extent of constantly waiting for the ideal setup to materialize, you will overlook some lucrative opportunities. There is no flawless setup, as each price action setup will have its unique characteristics. Instead of waiting for a 'perfect' setup, it is crucial to identify a good one and handle it effectively. Keep the pursuit of perfection from causing you to miss out on profitable trades! Your trading plan should outline the overall market conditions you seek and the trade setups you prefer as entry criteria. However, it's important to note that every trade will be different. There is a level of discretion and skill involved. With education and practice, you will develop a better understanding of the market and the specific conditions you seek to enter it.

Prepare Yourself for the Possibility of a Loss Before Initiating the Trade

One major factor that prevents traders from accepting losses is their tendency to micromanage. Micro-managing involves exerting excessive control over every minute aspect. Some individuals become overly fixated on micromanaging their trading, believing that by meticulously adjusting for every minor factor, they can somehow evade any potential losses. Alternatively, some individuals may develop the belief that their extensive studying and research grants them immunity from trading losses.

Losses are inevitable in trading, just like blood is an integral part of your body. Therefore, it is crucial to develop effective strategies for handling these situations and constantly remember that every individual trade carries the potential for financial setbacks.

As soon as you make your trade, you will experience a significant reduction in stress. Running a business comes with its fair share of costs and expenses. Traders view losses as an ongoing expense. Embrace it.

The Most Detrimental Consequence of Excessively Controlling Every Aspect of Your Trading Is…

Excessive trading is a significant issue that arises from excessively controlling and micromanaging your trades in an attempt to manipulate the market. As we delve deeper into the world of markets and trading, conducting extensive research and analysis, we often find ourselves generating an abundance of trade ideas and perceiving patterns that may ultimately be mere market noise.

Constantly monitoring the charts can lead to excessive micromanagement. Spending hours on end observing the intraday charts in an attempt to capture every slight fluctuation in the market is a classic example of excessive control over market movements!

It's similar to a boss in a company closely monitoring his employees throughout the day instead of focusing on his tasks and allowing them to work independently. While observing their work throughout the day, he may come across certain aspects that he finds unfavorable. However, one must consider whether this approach will ultimately bring about more positive outcomes or negative consequences. What level of frustration will the employees experience due to excessive control, and how eager will they be to resume work tomorrow? Moreover, how motivated will they feel to contribute to the productivity of the business?

To resolve this issue, it is crucial to identify your unique advantage. It is essential to adhere to your advantage and refrain from trading if it is not present. It's actually relatively straightforward. Here's where your trading routine becomes crucial. Stick to your daily routine of analyzing the markets and searching for setups that align with your plan. If there's nothing suitable, it's best to step away and come back tomorrow. And now, moving on to my last and concluding point...

The Ultimate Solution to Overcome Excessive Trading Control…

Spending excessive mental energy monitoring the market's constant fluctuations can be a significant drain. By simply disconnecting from your screens and stepping away from your computer, you can effectively eliminate the need for continuous monitoring and control over your trading activities and the market.

As previously discussed, it is crucial to incorporate regular breaks into your trading routine. This allows you to reset and regroup, enabling you to return with a renewed focus. Establish a structured routine for analyzing the markets and designate specific times for this activity.

It is widely acknowledged that investors who hold their positions for more extended periods tend to achieve better results compared to those who engage in short-term or day trading. Therefore, it would be beneficial to adopt a mindset that aligns more with swing or position trading or even long-term investing rather than day trading. Investors understand that constantly monitoring charts can be counterproductive, so they choose to refrain from doing so. Instead, they allow their positions to naturally progress without obsessively monitoring them, understanding that excessive monitoring can be counterproductive.


From this article, you have probably realized that you do not have to try to become a perfect trader in every sense in order to start making profits in the financial markets. In addition, there is no need to constantly monitor the market, because you can just go crazy that way.

The most important thing you can do is to constantly accumulate new knowledge and learn to put it into practice, and our FXCI block will help you do that. We thank you for your interest in this topic and wish you success in trading, even if you are not a "perfect" trader right now.

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