When trading forex, one of the most important factors that can separate winners from losers is your attitude. You have spent so much time learning, following and watching and now that you’re ready to begin trading live, you might realize that it is not as simple as it seems! So much goes into each trade, and then you still don’t know if you will succeed or fail in any given trade. But if you can sustain a positive attitude no matter what, you will have come a long way towards success. Here are a few of the factors that can separate those who are successful in forex from those who are not.
Take a Birds Eye View
It is easy to become too critical of yourself, your strategy and your trading skills. Don’t even go there! You have just as much a chance to win as the next guy does. But to be a winner, don’t stop what you’re doing to critique every move you make and every trade you enter. If you’ve done your homework, followed pros and set up a strong trading plan, there is no reason for you to doubt it or second-guess your strategy. You put a lot into it, so trust it and depend on it. If you make a trade that loses, so be it. If you make another one and again a third; well, it happens. Jot every fact and reason that you entered and exited the trade into your trading journal. At the end of a run of trades, or once a week, then you can look back at your trades and see where you went right and where it went wrong. Do this for a while before making any judgments towards your trading strategy. Use your daily journal as a learning tool.
Learn to Accept Risk
Accepting risk is part of the trading strategy. There is no way you can put your own money out there and not worry about it. You worked hard for that money, you studied diligently to develop your own trading plan, but then you realize that once you make a trade you have very little control over the outcome. The best thing you can do to limit your risk is don’t invest any funds that you can’t afford to lose, and in addition, pay close attention to the broker you select to handle your investment. With forex, the rule of thumb is 1% of your trading account. So even if you lose it all, you have not depleted your trading account. You can still continue to place trades. Set your stop loss and leave it there. EIther you will win from it or you will study your failure later and learn.
Know When You Are Wrong and When to Take Profits
If you understand that the forex market is random, then you don’t need to beat yourself up over every losing trade. Accept that it went wrong and go on. If it was a mistake on your part, then accept your mistake and learn from it. If the trade is going bad, exit before you lose even more. If it’s good, take your profits and keep on trading!