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It is often said that financial markets, Forex included, are driven by the opposing forces of GREED and FEAR.  This seems to be universally accepted, and the natural inclination is to approach trading in these terms when managing profit and risk.

I accept the greed/fear paradigm as an operating assumption, but at the same time do not feel personally bound to these being the prominent drivers in my own trading experience. Both fear and greed signal that something is wrong, and danger either from forces external or self-generated.  They are negative lower-frequency states of being, and qualities I don’t wish to cultivate in my life. I’ve decided not make an exception for trading.

While writing this post, I highlighted the word “Greed” for this dictionary definition: “Intense and selfish desire for something, especially wealth, power, or food”.  I don’t really relate much to the concept.

Trading does not feel any more greedy than previous work and endeavors to support myself and my family.  Yes, there’s potential as a professional trader to garner impressive income for very few hours of work.  But I resonate with something Jim Carey said when questioned about whether he felt guilty about the level of wealth and success he’d achieved, to which he replied “I’ve worked hard for a long time, and I’m a carbon-based life-form, so why not me?”  And I say also… “Why not me?”

I believe my motivations behind trading actions that result in generating profits actually fit more suitably under the umbrella of APPRECIATION. I appreciate every time I recognize price action providing a low-risk/high probability trading opportunities.  And I deeply appreciate in a broader sense discovering this accessible and achievable path to financial freedom and independence.  And the many positive ways observing and participating with the Forex can be applied beyond trading to the rest of my life.

So much for Greed… What about Fear?  Now that is certainly something I can more easily relate to.  I can cite many times in my life where my own fear only magnified the negative results.  At the same time, I can also identify hazards, some with lethal potential, that I currently negotiate with a calm and steady attention on a daily basis.

When I drive on the freeways, although aware of possible unexpected dangers, I do not drive in fear.  The same can be said for the times I command sharp objects and fire preparing meals and high-powered puncturing, maiming, and severing tools for my various home improvements.

In trading, I’m protected from consequences which I cannot afford by employing focused awareness, discipline and self-imposed guidelines.  Basing my actions on a healthy RESPECT of the market with all its financially devastating potential actually replaces what might otherwise be the emotion of fear.

No matter how the greater forces of greed and fear manipulate the moods and movements of market price actions, I know I’ll perform best when I’m feeling unafraid, grateful and productive.  To thrive in the long haul I must approach the Forex in aligned consistency with my best self, in the same way I build and develop other important relationships in my life.

To that end, having a structure supported by the cornerstones of APPRECIATION and RESPECT gives me the sense that I’m on a firm and secure foundation to build something vital, fulfilling, and enduring.

Brian Cutler
Director of WealthSmart
cutty@fx365i.com

Comments ( 1 )

  • Cyrus Sidhwa says:

    Cutty, I just want to say, FANTASTIC article! As someone who is currently reading (and constantly striving to employ the methods of) The Secret, this really resonates with me. I think we all agree that greed and fear are poor emotional states from which to base trading decisions. On mornings when I feel tired, I often think about how blessed I am to have this incredible opportunity to trade the Forex market. I also tremendously appreciate the constant support and teachings of Fx365i. I also like what you said about respecting the market more than fearing it. This is something I will strive for.

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