Home Forex Education Beginners Forex Education Is it Dangerous to Have Goals and Projections in Forex Trading?

Is it Dangerous to Have Goals and Projections in Forex Trading?

76
0

How many times we heard: “These are the results I’ve got trading forex in the past year so I can logically expect to get at least the same results this year”? Sentences like, “I pulled 10% out of a dead market in 2019 therefore, I should reasonably be able to get 15% this year”, or “I just got a 75% yearly return in my back-testing, then I should probably get 75% when I forward-test too which it seems logical, right?” If we had a good day or good week trading forex and we think that we can replicate that, what an awesome lifestyle that would be?

Well, it would, if we can somehow make accurate predictions and if nothing ever changes. What some people had a chance to experience may seem to them like a constant path of winnings. It is not going to be the same every single week, not to account for the weeks where we are actually going to lose money. When euphoria kicks in, we all easily become overly-optimistic and then reality tends to hit us in the face. We all know trading forex is a highly inconsistent business.

The word we are going to focus on for a second and that might be beneficial for us is the word ‘Build’. A lot of traders have already built a great trading system that they are using right now with pretty good results. The thing is that we need to constantly build this. We should never-ever stop improving our system and developing our account. We mustn’t get comfortable around these things even if we are using great indicators. If we found some of the indicators that we liked and think that we don’t have to go and find something else which works better, that might be deceptive for us.

Traders should keep improving, keep testing, and never stop. We trade with indicators, we have algorithms, we can try to cut and paste certain algorithm to other markets and then just adjust it as we need to. We might try to make those adjustments in indices and the metals and two lesser degrees in crypto. We should always build up around what we have and slowly make pieces in place so we can start filling those pieces in. After all, everybody should have at least two or three ideas at the end of the day. All smart traders must constantly have extra safety layers underneath if their trading system completely goes south. So this is one of the many things that we can do to make our account less fragile, rather than project what kind of lifestyle we are going to have which we are all naturally predisposed to do. That slowly gets us back to our topic. Sometimes is better to just let the chips fall where they fall.

We need to be very careful about projecting how much money we are going to make in the next three or four years because we might pay dearly based on those foolish projections. No matter what we do, we are going to have losing weeks or losing months. Maybe there are out there some experienced traders who can set a goal to shoot for, but most of us don’t have an experience that they have. Simply, It can be safer not to set goals. Here we want to point out how relaxing it could be if we don’t set goals and not make projections. Just build. Improvement, discipline, and patience are what we need to put together and just watch how the results come organically.

It’s a hard thing to do, we all want to project. Projections are what we tend to do when our emotions start to get in a way, projections are not logical because we know that every year is going to be different than the one before. How can we make any projections for it while wild inconsistency is all around? What we can do? If we take proper steps and if we build the right way, we could be naturally immune to downswings and maybe be able to take full advantage of the upswings.

So when the year is over with we might still look back and say: “That was a successful year”. What we are trying to improve here is our trading psychology. That is why we need to build, we need to build now. It is not a quick process, It is not always an enjoyable process but it is a necessary process if we no longer want to be like 99% of people who are super frustrated with their jobs and don’t have a way out. This is something we should always keep on our minds and work relentlessly on our trading skills.

LEAVE A REPLY

Please enter your comment!
Please enter your name here