ABC of Forex Trading Success
- Traits of Successful Forex Traders
ABC of Forex Trading Success - Traits of Successful Forex Traders
Forex trading is not for everyone. There are a lot of variables to take into account, and there is always the risk of losing money. Some people just aren't cut out for it. If you are considering becoming a forex trader, you'll want to read this article carefully. It contains the traits that set successful traders apart from those who fail.
If you don't possess most or all of these qualities forex trading may not be for you:
Successful traders formulate a trading system that works and stick with it. They don't try to trade "on the fly".
The ability to accept risk
Despite what many will tell you, forex trading is not without risk. You can lose money by trading, and you must be willing to accept this risk.
The ability to accept failure
Even the best traders in the world lose money on some of their trades. It's the nature of the beast. But the difference between them and average traders is that they don't focus on their failure. They accept it, learn from it, and move on.
Successful traders have confidence in their knowledge and in their ability to make winning trades. They don't doubt or second-guess their trades.
The ability to accept being wrong
Hey, no one is perfect. You're going to make mistakes and there will be times when your analysis will be way off. Don't stubbornly stay in trades gone bad just because you refuse to admit being wrong. Cut your losses and look for the next opportunity to make it up.
Smart traders follow their system and wait for good opportunities to present themselves. It's not necessary to have positions open at all times. You may go a day or two without any trades being made. Don't trade just for the sake of trading. You'll jump into many more bad trades than good ones.
Knowing when to get out
The key to trading is not just knowing when to get in, you need to know when to get out. Many a trader has gotten greedy and stayed in a trade too long only to see their profits wiped out by a sudden downtrend. When your trading system tells you to get out, listen to it.
Know your financial limitations
Don't over-leverage yourself, and don't trade with money you need to pay your mortgage. If you do you'll risk ending up on the street. Only trade with money that you can live without. If this means starting small with only a few hundred dollars, so be it.