AI-Enhanced Forex Trading Models Based on Behavioral Finance Principles AI-driven forex trading models are transforming market strategies by integrating behavioral finance principles. Traditional trading relies on technical and fundamental analysis, but AI now incorporates trader psychology, cognitive biases, and emotional decision-making to improve market predictions. Using Natural Language Processing (NLP) and machine learning, AI analyzes financial news, social media sentiment, and trading patterns to identify behavioral trends like herd mentality, overconfidence, and loss aversion. These insights help forecast market sentiment shifts and potential price movements. By recognizing patterns of fear and greed, AI-powered systems refine risk management strategies, adjusting positions dynamically based on sentiment analysis. Automated trading models eliminate emotional biases, ensuring rational and disciplined execution of trades. As AI continues to learn from behavioral finance data, forex traders gain a competitive edge, making more informed, data-driven decisions that align with market psychology and investor sentiment.