Trading wisdom: Trading is a job and trading education is important.It is not enough to read forex and trading books.traders need to think, be patience.
This article will help you become a better Forex trader in the year we have already stepped in. the new technologies and the new atmosphere is going to bring certain changes in every aspect of our life, so is going to happen with the Forex.
People often get tired before reaching their goal in most of the things they do, and often it they are unaware how close they were. With traders, it is the same thing; many times you have been so close to getting a score, but maybe you missed something – even a minor step – simple that could lead you to a door of success. Knowing how to avoid such mistakes, well, not only small ones, but major ones too, is going to give you huge advantage towards your goal. And your goal is everybody’s – success. Learning is – some say – best from mistakes, preferably from other people’s mistakes, not your own. Some traders will dig and dig until they have something worthy, but some will give up after a series of unsuccessful attempts. The sad part is that you never know if you needed just another trade before turning your wheel of fortune towards your success.
This article might help you overcome moments of impatience and help you recognize your own mistakes in your strategies. It might as well mention a couple of mistakes that you were or are about to make, so don’t.
The important thing, as you have surely known from before, is having a firm strategy (or strategies if you know what you are doing) and patience. But that is not only one important; it is the important aspect of your personality as a trader. The reasons for traders to lose money are numerous; among them is persistence in trying to pull yourself out from some losses by doing the exactly same mistakes that you got yourself into them at the first place. There always has to be an edge to every trade, so quitting before reaching it is wrong. And the major reason for most of the traders who quit before getting back on the track is the emotional attachment to the work. Right after a couple of losses, the trader begins to feel worried, instead of getting it to the edge, he changes his routine, but that actually opens up the new line of trading, so the new trading edge occurs, and the one that was about to be reached stays behind. Trading edge always has to work, but all the losses, wins and evens have to be taken into account, and one system has to be carried through.
Another way to overtrade is when seemingly a trader is on a good run and emotions start to take over the reason. We can never forget that we can enjoy doing our job, but business comes before pleasure, especially in this job, where pleasure can turn out to be very expensive. So, for example, a trader is on a good run, and he starts feeling confident and raises his investment. As previously said, the edge has to occur. But hot mind forgets that, the streak of wins is really good, and the trader thinks that he is just a step away from becoming the richest man ever who traded at the Forex market. But this is the same story as with losing streak, only with opposite situation and thus opposite outcome. Therefore, in this situation the trader has to apply opposite strategy. There are many proverbs about this, and translated into all the languages, it goes roughly – you should know when to quit when you are on a good run.
Patience and trading
You might find out that the world’s most famous investors and brokers had their own strategies, but the most successful of them had this one thing in common; patience. Knowing when to stop trading, knowing when to buy, when to sell, that can be ability possessed in different form with each person, but patience as it is stands alone unchanged with every successful investor. Trading at Forex does indeed seem like a job where you can get lots of money overnight, and when traders start to think that the strategy they’ve been working on does not work, they simply jump to another strategy thinking that that strategy is better, as it got success to some other trader they heard of. But it’s individual how each and every one of us uses certain strategy. Waiting with the strategy is the key.
A successful trader doesn’t switch methods just like that whenever he feels it isn’t working, but develops the strategy that he finds best for his abilities and his own personality. An edge has to come. With help you can take your time without losing much money and anticipate the edge sooner, rather than later. Nobody got rich overnight, even those who appear to be lucky exceptions spent years and years on developing systems that would ensure their wealth stay safe and long lasting, and keep it growing.
Trading and education
So, sticking with own strategy and perfecting it is essential, like in any other job. In sports, a player can be “all-around” but he knows his position. An offensive player sticks with practicing playing on that position for years before making it a first team, and it is just then that he gets to play the position on the field he perfected. This is the same thing, you pick a strategy that suits you and with lots of practice, you make perfection. Don’t think that practice in this job is made with any difference in cost than in other aspects of life. Everywhere you have to invest in your education in order to get revenue. But don’t fall in trap many new traders tend to in this job. Many of the novice traders believe that they can learn while already trading, after just knowing maybe how to place a trade at all. You don’t need to invest your real money in order to learn what to do, and you can’t anyway. It would take you way too much money to learn that way. If you had it, you wouldn’t have to invest it this way. Wasting money to learn how to trade is wrong for several reasons. One of them is treating money. You are here to earn money, not to waste it. And doing something for costly price when you can do it for some reasonable educational charges that actually educate you is wasting money. You don’t want to be a money waster, you want to be investor.
Importance of concentration
In order to do any job good it is important to be concentrated and relaxed. Even the people who work in factories on lanes need to be focused, because if they lose touch and start working automatically in the rhythm of the machine, they might miss some important failures with the products, or even a miscellaneous with the machine, which might hurt them. And what to say about a job where you have to think fully about what you do? It is important to know your physical limits and when you see that fatigue is catching, take rest and recuperate properly. Let’s not turn this into a medical manual, but we can mention the importance of proper nutrition, eating various food and lots of different fruits. Coffee might seem like a good idea here, but never exaggerate.
Being a trader requires good memory, so find foods that will help you maintain your memory.
Trading and health
Planning about getting rich with trading requires from a trader to have in mind that wealth doesn’t come over night. Simplicity and the Forex’s resemblance to betting makes novice traders think about gaining fast profits. But that is not the case. Trading is a business, a job, so earning steady and continuously is what the whole thing is about. Occasional lucky day might occur, but the same way it can go other way round. Therefore, the focus of a trader has to be earning money long term and working long term. It is safer to earn and have positive balance by the end of each week or month, set your goal to some of that kind of period of time; that makes you be more careful about your investments and it makes you more relaxed, as your goals are not achievable in that case. By setting your goal to have a positive month allows you even to get into a bad streak, but then you can wait for the edge. It has to happen. With the monthly check out plan, you can regularly – without worrying because of losing streaks – see streaks without too much excitement, which is important for health in this business.
Another thing about the Forex will make you think twice before you decide to be one of those who want to trade more in order to get more. Statistics show that a good month are usually seen with having 4-5 good trades, and when you compare that to those traders who are looking to trade 5-6 trades a night, you understand that there is no profit in rushing. This basically means that you can have one good trade weekly in order to be a good and successful trader. So, calculate how many trades you need to execute per night in order to have a good winning percentage.