Six Essential Elements For Forex Trading Success
Six Essential Elements For Forex Trading Success
Forex trading is one of the four key strands in my multiple income pathway model. Every day trillions of dollars are traded across the money markets, and many people make a very good living by following the currency charts carefully and snatching pips when they see momentum and movement.
I have010-002 been dabbling in the Forex market for about five years, and it’s been a steep learning curve. I use the word ‘dabbling’ here very carefully, as the markets can be very volatile, and it’s very easy to lose everything. I think I’ve now got enough experience to be able to put forward a considered viewpoint, and my attempts at trading have taught me that two groups of people actually make most of the money:
1. Professional day traders
2. So-called ‘experts’ who sell us trading systems
The potential for financial gains from Forex trading is enormous, and trading systems are marketed to target our emotions and desires. Who could resist an offer to make “$1000 a day sitting in the comfort of your own home”?
So if we can’t resist, and we do get involved in the world of trading in the money markets, what guidelines should we follow? From my own experiences I would like to make the following six recommendations:
a. Be consistent. A little can go a very long way, particularly through> the power of compounding (Einstein’s “eighth wonder of the world”). If you started with a budget of $2000 and made just 3 pips a day, then after 24 months of trading you could have made a profit of over $90,000 – for just 3 pips a day!
b. Find a system you like and run with it. There are good systems out there that have been developed by honest individuals (avoid the trading robots!). You need to be able to trust what these guys say and then apply what they say. Avoid the temptation to ‘tweak’ (one of my weaknesses).
c. Don’t get emotional. You will make losses as well as gains, and these are part of the game. Do not take it personally. Just accept losses and move on.
d. Commit time. You can’t be rushed to trade, so if you’re trying to squeeze an hour’s trading in before dashing off to work then think again. Markets move at their pace, not yours.
e. Keep accurate records. It will boost your confidence when you can see that profits have been made. Don’t expect to make 3 pips every CVAday, but look to average out over a week, or a month.
f. Stick with it. If, (although hopefully this won’t be the case) you lose everything, at least you’ve tried! As with all trading and betting, you should only use money that you can afford to lose.
Of my six recommendations above, I guess I’ve failed in five! I’m a good record keeper, but I need to work on everything else.
If you can really apply my recommendations then you’ll be on the right track to becoming like a professional day trader – and they’re the guys who do make money!
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