Forex Trading success is a marathon not a sprint.
This might in fact be the most important part of this mini-course for you to read multiple times and fully understand. If you wish to achieve long-term success as a forex trader you really need to view the process as a marathon and not a sprint. There is paradox in forex trading that revolves around the notion of the harder you try to make money the less money you will make. This might seem a bit strange to the newbie trader, but to the more experienced trader it very likely resonates all too well.
Many beginning traders are initially attracted to forex strategies because they have read somewhere on the internet or perhaps heard on TV that it is perhaps a great way to make some fast money. While it is true that you can make extra money as a forex trader, you should understand the fact and accept that unless you have a relatively large amount of money to fund your trading account with, you simply will not be able to make large consistent profits. What ends up happening to many traders is they begin risking too much money after a series of winning trades as a result of their confidence being high. This then inevitably results in them losing a larger portion of their trading account than they normally would if they had been following proper money management rules. Once you get stuck in this cycle of risking too much, getting lucky and making some significant fast cash, and then giving it all back, it is very hard to stop or even recognize what you are doing.
All of these actions are a result of trader’s not viewing forex trading as a marathon to success but instead as a sprint. People approach the markets with all sorts of desires and wishes; they want to pay off a loan, they want to buy a car, they want to make enough money to quit their job, there are all sorts of reasons why people get involved in the markets. The problems arise when traders feel like they “need” to make money from their trading, if you feel like you “need” to make money in the forex market to be happy or to live your dream life, but you don’t have very much money to start trading with, you are approaching the market from the entirely wrong perspective and setting yourself up for a huge financial disaster.
You must learn to trade in harmony with the market, you cannot control the market; you can only pre-define your own actions if XYZ occur in the market. Many traders do not pre-define their trading behavior though; instead they unknowingly try to control the market by reacting to its movement impulsively and emotionally. Unfortunately what these traders don’t realize is that the market does not care if you get emotional, the market does not care if you lose your entire life savings, and ultimately you are the only one to blame for your forex trading mistakes and no one else. So, in order to avoid such disasters we need to view forex trading as a marathon, it is not a sprint. The more you try to sprint and “force” money out of the market, the more elusive it will become. Patience and discipline are the fastest routes to consistently profiting in the forex market.
Click here for Part 5: A word on Forex Trading Strategies
