There are many stories of people that have engaged in foreign exchange trading (forex) without any meaningful results to show for it. Many people even wind up losing their savings and investment into the venture. The truth is, without some knowledge of some insider secret about forex trading, success might not come easily. So, what are the secrets of few traders that are having tremendous success with forex? In this article, I will be sharing some of the tips behind the secrets of most successful forex traders.
- Maintain The Right Attitude
Attitude is a very broad topic, but the broad detail is not what this article is concerned with. Attitude in forex trading means developing and imbibing the following three attributes:
- Patience: Oh I cannot overemphasize this. Patience is needed in order to wait for the price to get the entry/exit point indicated by the system. This will go a long way in avoiding unnecessary errors.
- Discipline: Discipline cuts across all spheres of life. You need discipline to hold your peace and trust the system till it signifies an action point. Discipline is needed to follow and not second guess all action point indicated by the system. In fact, this is needed to avoid loss.
- Realistic Expectation: In other words, face the fact. Do not expect to make $2000 on investing $500, although the market can sometimes make much bigger reward than anticipated, those are exemptions circumstances, not everyday affair. Having a realistic expectation helps remove the unnecessary anxiety that usually push many people to make errors in forex trading.
- They Use Price Actions
In my sojourn in the Forex trading world, I have discovered most of the gurus rely heavily on the usage of price action. I also discovered that the way they use it differs despite the fact that it forms an integral part of their trading strategy.
Price actions play a key role in any trading strategy when it is used to identify key levels in the market. Price serves as an indication of the psychology in the market that gives a trader an idea of other traders’ mind. Being knowledgeable about the areas of buy and sell orders in the market is essential to becoming a successful Forex trader. This can give you an edge over other traders by making available to you areas to watch for potential entries and profit targets. It is not surprising that this is one of the strategies in the article published by one of the best forex trading company based in Australia. Although it is possible to trade Forex without price action, I wouldn’t advise it. It might not be beneficial in the long run.
- They Know When To Take a Break
Anybody passionate about Forex trading would understand how difficult it is to walk away from the market. However, this is one thing successful traders have learned to do.
After a Win
After any win, we are feeling very proud of ourselves and trading strategy. Walking away is essential after a win as it’s necessary to calm nerves and allow emotions to settle. Pride, excitement and wild emotions are the last thing needed in the Forex trading platform
After a Loss
We have different ways of handling losses. It is normal to have the urge to get the money back after a loss, but that might not be a good idea at that moment.
Do not see a loss as a reason to try harder, No. It’s actually a sign to take a breath and analyze what could have been done differently. I am not saying you need to get rid of your emotions, rather channel the emotion into how it will make you better.
- Discrimination
A successful forex trader knows that various instrument trade differently depending on the reason for trading that particular instrument. The big banks that are trading the spot currency market in define currency do have a much different objective than various currency traders transacting future contracts. As long as you can find out what drives the large players, you can identify with them and profit as well.
You could also pick some stock or currencies and get them charted-up in different time frame. After this, you could apply your chosen methodology to them all and discover the time frame and instrument that responds the most to your system. This way, one can discover a personality match for the system, a good way to adapt to changing market conditions as well. Mastering the secrets of successful forex strategies will involve having an open mind.
- Set a Defined Edge
Simply put, an edge is everything that makes up the way trading is done so as to put the odd in your favor. Thus, your edge is simply the combination of your price action, the time frame you trade, the key levels you are identified with, your winning and losing strategy etc.
In other words, one’s edge could be a combination of dozens of factors. And it is not necessary to master them all at once. Getting started with one and gradually proceeding to the other is the best and most preferred way to go about it. In fact, it is not advisable to try to master them all at once, no wonder they say “Jack of all trade, master of none!” Being a master at three or four and then proceeding to the rest is a way to be more successful.
In closing, I hope this article has been able to shed some light on the successful characters of Forex Traders. Remember, there is no right or wrong way to trade, there is only a profit-making and loss-making method. Decide!
Having these tips at the back of your mind will put the odds in your favor big time.
Go make the money!
Related
Do you have info to share with HuffPost reporters? Here’s how.
