Becoming A Profitable Trader
Breaking bad trading habits that will make you lose your investment
Warren Buffet once said there are only two important rules of investment:
- Rule number one -never lose money
- Rule number two- never forget rule number 1
Right from the beginning it is important to note that there is no capital so large that it is impossible to lose during speculative operations in the Forex market. where there is a possibility to earn, there is also a risk of losing even the entire injected capital. With this in mind risk only what you are psychologically capable of containing in case the trades move against you, do not be frivolous. It is not a wise thing to gamble. Don’t go into an investment with an attitude that it’s okay to lose.
For you to become profitable in forex trading there are two critical components that builds up a career in this lucrative industry, one is theoretical preparation and learning, the last one being developing practical skills, trading techniques as well as developing a good trading strategy.
Always have that zeal to learn the theoretical thesis behind the concept of trading, knowing what is a forex broker? what makes the international market system? what is a pip? when should I sell and buy, leverage and many other technical terms If you do not know some of the questions above then this article talks to you, do not execute a trade not just yet. Its good to master the very fundamentals of forex trading before you begin. Once the theory is done then move on to the application, develop techniques become acquainted with your trading platforms, there is MT5 and MT4, cTrader and binary.com
Use a strategy that works best for you
There are a number of strategies that you can use which has proven to be useful over the decades, some even have good reward percentage ratios. Most of the profitable traders still uses traditional strategies like BTMM, ICT, PRICE ACTION and QUARTERS THEORY. If you don’t want to lose your investment you necessarily do not need to master all of them but find one that works best for and be consistence with it. You have to apply the technique on as many instruments as u can on a demo account until you approve of it. Once you become profitable in a demo account then move on to a real account not with a demo psychology enter your trades knowing real money is at stake.
DO’s and DONT’s
- Have a trading plan, a trader without a game plan always lose money in the market, by the time you will realize you are almost losing all of your investment it will be too late. Set yourself a target of how much you are willing to lose. Not only this, set yourself a target profit you would be happy with.
- Always be on watch for the forex drivers like news and public announcement.
- Be patient with your trades and develop a habit of monitoring your trades.
- Do not let your emotions take over, because money is involved, stress kicks in but do not let anxiety be the trader always be in control of your emotions, emotionless trading is profits secured.
- DO not trade without a stop loss.
- The rule of thumb never let greed and fear cloud your judgement when you have opened positions.
- Do not revenge trade at all cost, once you have reached your target profit take it, if you have lost money learn to fly away because we live to die another day.
- Do not go all in (trying to win it all back)
“Money is just something you need in case you do not die tomorrow. Let this is a reminder for you not to obsess over profits and losses. In whatever you do, strive for enjoyment, focus, contentment, humility, openness… Paradoxically (and as an unintended consequence) your trading performance will improve significantly.” ….Yvan Byeajee
I hope you will have an interesting forex trading journey, but basically forex has more to it than what meets the eye, trade safely and guard jealously your initial capital, remember to grow it slowly but surely.