Tag: Forex Goals

Categories
Forex Basic Strategies

How to Trade Your Way From 500€ Up to $1 Million

If we refer to Dan Zanger, Rob Booker, among others, we can say that yes, that they have achieved high returns from relatively small accounts. The secret of both the same: a lot of effort and a lot of perseverance. Obviously, virtually no one is considering achieving high returns from such a small base, but […]

If we refer to Dan Zanger, Rob Booker, among others, we can say that yes, that they have achieved high returns from relatively small accounts. The secret of both the same: a lot of effort and a lot of perseverance. Obviously, virtually no one is considering achieving high returns from such a small base, but […]

If we refer to Dan Zanger, Rob Booker, among others, we can say that yes, that they have achieved high returns from relatively small accounts. The secret of both the same: a lot of effort and a lot of perseverance. Obviously, virtually no one is considering achieving high returns from such a small base, but I will prove, at least mathematically, that the fact is possible.

Step One

Have the account in micro-lots. The benefits of the accounts in micro-lots allow us to adjust up to the last euro, our monetary management. Being able to add a micro lot more in each operation will make us enter with the right capital, not much, not little, which if we had a standard account, the least we could adjust, would be with hundreds of euros. 0.1 lots = 100€/$ (depending on the currency of the account itself).

By the time we have a large enough account, it will be time to move to an ECN account. The main advantage that we will have is the drastic reduction of spreads (in many cases, they are below a pip), so it will be easier to get positive trades.

Step Two

Have a system, obviously with positive mathematical hope. During the creation of the system, it would be good, at least in my opinion, to look for systems with high success rates. What are the advantages of a system that makes 90% of hits compared to one that makes 50%? Consistency. The probability that the former will make 5 consecutive losing trades amounts to 0.001% while the one that has 50%, make 5 bad trades, is 3.13%. Much more likely.

If in the first system, we lose 5 consecutive times, we have to worry, since it is very likely that the system has expired at least temporarily, while in the second, we should wait until operation 13.

Step Three

Risk. This point can raise blisters among our readers. Here we must read very carefully, and have very clear consequences that can have. An error in understanding can leave us with nothing. Now you see why he wanted a system with a high percentage of hits.

Let’s start. Let’s deduct: the higher the risk, the higher the profitability, and with this, the faster to get that million euros/dollars. We have a system with a 90% hit, with a Take Profits of 30 pips and a Stop Loss of 120 pips. 1:4 ratio. Matematica Hope 0.13%.

What number of operations should we do to get to 1,000,000?

Logically, at greater risk, fewer operations are needed to achieve our goal. The next step we should consider is knowing how many trades we have before we lose all the capital in our account. If at most we want to keep 50€ of the initial 500€, at most we want to lose: (50-500)/500 = -90% of our account.

 

Therefore, if we have a system that hits 90% of the time, the probability of failing 5 consecutive operations amounts to 1:100,000. Virtually impossible. As we can see, the maximum risk that can be assumed should not exceed 35%, because if we see that the system loses that fifth operation, we will know for sure that the system has abandoned us.

Suppose now that we have found a system like Tim’s, with 95% of hits. The probability of failing 4 operations amounts to 1:160,000, therefore, we could already reach risk of 40%. In order to reach 50% risk, we should find the system with 98% of hits. If instead, we have a system that is 50% correct, we should wait until operation 17, to know with great certainty that the system has stopped working (probability 1:131.072). Therefore, we could not risk more than 10% per operation.

Conclusion

To reach 1.000.000€ we can do it through two routes:

The traditional route, little risk, little by little, waiting for some 6000 and peak operations (doing one operation a day, and that the system does not fail us halfway, are approximately, about 25 years (one operation a day, during the 52 weeks of a year). The venture capital route, that is, if we lose all our capital, “nothing” happens. In this case, we just have to look for probability, mathematical hope on our side.

The number of operations according to risk will vary according to the mathematical hope. The system I have proposed has a very low hope. With higher hopes, fewer operations will be needed. The truth is I highly doubt that anyone in their right mind can do a high-risk strategy (more than 10% per trade) by doing manual trading. It is most likely that such “suicidal” strategies can only be done consistently through automatic trading.

Categories
Beginners Forex Education Forex Basics

Realistic Forex Trading Goals for Beginners

It’s important for traders to set goals in order to gain a sense of accomplishment and to know that they’re on the right path. However, setting the wrong goals can set you up for disappointment. For example, many traders begin with one primary goal: to get rich. This certainly isn’t going to happen overnight, and […]

It’s important for traders to set goals in order to gain a sense of accomplishment and to know that they’re on the right path. However, setting the wrong goals can set you up for disappointment. For example, many traders begin with one primary goal: to get rich. This certainly isn’t going to happen overnight, and […]

It’s important for traders to set goals in order to gain a sense of accomplishment and to know that they’re on the right path. However, setting the wrong goals can set you up for disappointment. For example, many traders begin with one primary goal: to get rich. This certainly isn’t going to happen overnight, and you might feel as though you’re never going to get there if your only goal is distant and hard to reach. This is why you should start with smaller, more realistic goals.

This isn’t to say that it’s a bad idea to have long-term goals, only that you should focus on more immediate things that you can do. These goals shouldn’t only focus on money either. Instead, you need to pay attention to your progress as a forex trader. In a field where more than 70% of beginning traders fail, you deserve to pat yourself on the back for doing well, even if you’ve only made $1. 

You can always set your very own personalized goals, but we thought we would provide some good examples of noteworthy goals for beginners to help provide an idea of healthy, attainable trading goals.

  • -To make more money than you lose
  • To spend x amount of time each day researching topics related to trading, like strategies or insightful articles
  • To make progress as a trader
  • To keep a trading journal and review it often to monitor progress
  • To follow your trading plan
  • To learn from mistakes rather than fixating on them
  • Not to become overly emotional when trading

As you can see, these goals focus on making progress as a trader, but they don’t define a certain amount that one expects to make. Setting goals that say you will make this amount of money in this amount of time are a bad idea because it can be difficult to meet those goals realistically. 

Once you’ve set your trading goals, consider giving yourself little rewards for meeting some of them. You could treat yourself to dinner at the end of the week if you made more money than you lost or buy yourself something you’ve wanted for a while whenever you meet a bigger goal. Stimulating the reward center in your brain will make you feel good about your accomplishments and you should feel more motivated to do better as a trader.

The bottom line is that long-term goals are good for forex traders, but beginners need to focus more on short-term goals that make them better traders. Managing emotions, making progress, spending time doing research, and other self-improvement goals not only help you in the short-term, but they will also make you a better trader that is more capable of reaching those harder to reach goals, like making a lot of money, becoming a successful forex trader, making enough money to quit your day job, and so on. Remember that one day, you will meet these goals, even though it might take some time.

Categories
Beginners Forex Education Forex Basics

SMART Goals For Forex Trading

You have probably come across the term SMART goals before, it is used all over the world in pretty much every profession that you can think of. Why is it used so much? Simply because it works. SMART goals are a way of creating targets in a way that ensures that you will be able […]

You have probably come across the term SMART goals before, it is used all over the world in pretty much every profession that you can think of. Why is it used so much? Simply because it works. SMART goals are a way of creating targets in a way that ensures that you will be able […]

You have probably come across the term SMART goals before, it is used all over the world in pretty much every profession that you can think of. Why is it used so much? Simply because it works. SMART goals are a way of creating targets in a way that ensures that you will be able to achieve them and that you will be able to monitor them along the way. These sorts of goals can also be used when trading in order to plan and achieve your trading targets.

So what exactly are SMART goals and what does it stand for?

SMART is an acronym for setting goals it stands for :

S – Specific

M – Measurable

A – Achievable

R – Relevant

T – Time-bound

So now we know what the letters stand for, let’s look at what they mean.

Specific:

The goal that you set needs to be both clear and specific, this enables you to focus on it fully and you will know exactly what you are aiming for, this can help to promote motivation towards achieving it. There area  few questions that you can ask yourself in order to work out what your specific goal should be:

  • What do we want to achieve?
  • Why is this goal important?
  • Who will be involved?
  • What resources or limits are there?

In relation to forex, this could be a specific goal aimed at achieving certain profits or profit levels, or to achieve the completion of a trading strategy with a certain win percentage.

Measurable:

The goal needs to be measurable, this will enable you to monitor and track the progress that you are making towards the target. Being able to monitor and assess the goal and your progress towards it will help keep you motivated towards achieving it. You can work out what your measurable goal would be by asking a few questions:

  • How much?
  • How many?
  • How will I know when I have achieved it?

In relation to reading, this could be related to the goal that we thought about above, if we are looking to achieve a certain percentage of profit or monetary value, then this is a measurable target, as we are able to measure our progress by looking at the current profit levels.

Achievable:

The goal that you set needs to be achievable, this basically means that it needs to be realistic, it needs to be something that you have the ability and the capacity to achieve, there is no point in setting a goal that is way too high, as you will never actually be able to achieve it. You can work out this section of the goal by thinking about:

  • How can I accomplish the goal?
  • How realistic is the goal based on my circumstances?

If we take the same example that we have been looking at, we want to achieve a certain profit percentage or monetary value. So what would we set this at If we have a starting balance of $1,000, there is no point setting a target of $1,000,000. While that would be very nice, it would be more realistic to set your initial goal as $2,000 or $5,000 at a push. Remember this needs to be something that you are able to achieve.

Relevant:

The goals that you set need to be relevant, they actually need to be related to what you are doing. It needs to be relevant to you, it needs to be of interest to you, there is no point having a goal that you aren’t interested in, or that won’t actually help you achieve anything in relation to the activity. You need to ask yourself a few questions:

  • Is it worthwhile?
  • Is this the right time for the target?
  • Am I the right person for this target?

Once again when we look at this in relation to trading, the target of gaining a monetary value is very relevant to the task and also our overall interests, wheat would not be relevant is something like gaining muscle mass while trading. That is a little extreme of an example, but you get the idea.

Time-bound:

You can probably guess what this is referring to, it is all about having a timeline and an ending point at which point you wish to have achieved the goal, this could be a few days for a small target, or it could be a year away for a long term goal. What is important is that it remains realistic. You should ask yourself a few different questions:

  • When do I want it done?
  • What can I achieve in 6 months?
  • What can I achieve in 12 months?
  • What can I do today?

Looking at the same example that we have been using throughout, we want to gain a 100% profit on our account, $1,000 to $2,000. Is it realistic that we can do that by next week? It is possible, but not very lightly. What is more likely is that we can do it in 1 year, 12 months to achieve this goal. That seems realistic, so let’s put it down.

So as we went through the meaning, we kind of set out a SMART goal of our own, we want to double our account and go from $1,000 to $2,000 within a year. Is this goal specific? Yes, we know exactly what the target is. Is it measurable? Yes, we are able to see our account balance increase as it goes. Is it achievable? Certainly, we have a good strategy and it can definitely be done. Is it relevant? Yes, it is part of both trading and it is of interest to us. Finally, is it time-bound? Yes, we want to achieve it within 1 year.

Now that we have a goal, we can write it down, set up the method of measuring, and set ourselves on a path to achieving it.

SMART goals are a fantastic thing to set, both in trading and in pretty much everything that you do in life. It is certainly worth sitting down and setting some of these goals yourself, it will give you a lot of motivation seeing that progress is being made as you go along.

Categories
Forex Basics

Are These Issues Causing You to Fall Short of Your Goals?

As a forex trader, you should always be working on self-improvement to make a better impact on your trading decisions. Making an effort to address problems like allowing negative emotions to interfere with your choices or not spending enough time researching trading topics you could learn more about are a couple of examples of things […]

As a forex trader, you should always be working on self-improvement to make a better impact on your trading decisions. Making an effort to address problems like allowing negative emotions to interfere with your choices or not spending enough time researching trading topics you could learn more about are a couple of examples of things […]

As a forex trader, you should always be working on self-improvement to make a better impact on your trading decisions. Making an effort to address problems like allowing negative emotions to interfere with your choices or not spending enough time researching trading topics you could learn more about are a couple of examples of things that can impact your trades. If you find that you aren’t meeting your trading goals, ask yourself these questions:

Are You Setting Realistic Goals?

When setting trading goals, many beginners start out with one thing in mind – making money. The truth if this is your only goal, you aren’t doing yourself any favors. It’s also a bad idea to set goals that focus on making exact figures, as it’s nearly impossible to predict that you will make a certain amount of money in x amount of time. It’s ok to have long-term goals, as long as you understand that it will take time to reach them. However, even your long-term goals need to be obtainable. If your goal is to make a million dollars and you’ve only invested $100, you aren’t setting a realistic goal. In the meantime, you should set short-term goals that are possible to reach. Here are a couple of examples of good short-term trading goals:

  • To spend x amount of time each day researching different trading topics
  • To actively log each trade in a trading journal and to review those results after a certain period of time, like a week or a month
  • To invest x amount of money into your trading account each time you get paid, even if it is only $5 or $10. 
  • To finish reading a book that was written by a successful forex trader

As you can see, the above goals can be reached fairly easily, but it will take some effort to get there. The reward centers in your brain will thank you when you complete one of these goals, which is better than feeling stressed out because your only goals are long-term and out of reach. 

Do You Have a Plan to Actively Meet Your Goals?

Sure, you might want to make money, but how do you plan to get there? You’ll need an active trading plan, which covers the following topics and more:

  • How you will find and execute trades
  • How large of a position you will take (i.e. your risk-tolerance)
  • What assets you will and won’t trade

Your trading plan basically covers what and when you trade, including decisions that involve entering and exiting trades. From there, you’ll also want to think about a trading strategy. A strategy is different from a plan because it outlines what type of trader you are. For example:

  • Day traders typically open a few positions each day and close them before the end of the trading day
  • Swing traders might open one large position or a couple of medium ones and leave them to accumulate for days or weeks
  • Scalpers open several positions a day (sometimes even 100 or more) and attempt to profit off very small price movements

The strategy you choose can offer benefits and drawbacks. For example, a scalper only makes a small profit off each trade, so one big loss can wipe out their earnings for that day. A swing trader is subject to swap fees, which are charged by brokers for leaving positions open overnight. Day traders don’t have to worry about these fees, but each person might not have the time or patience to take up day trading. 

The point is that you need to have a good trading plan and strategy set up to reach your goals. You won’t be able to make money without putting thought into the how’s and why’s of the way you trade. If you’ve been trading without a real plan, now’s the time to figure it out. If you already have one and aren’t meeting your goals, perhaps it’s time to look at your plan as a whole and to see if any changes need to be made.

Are You Tracking Your Progress?

We’re referring to a trading journal here. Some traders might start out using one, only to abandon it once they get a little more experience under their belt. Others might never use one at all. When you keep a trading journal, you log information about each trade you make, including your profits/losses, why you entered or exited when you did, any emotions you were feeling at the time, and so on. Later, you can go back and review that data to look for reoccurring issues that may need to be addressed. Sure, you might notice if you lose money, but without a trading journal, you may not be sure of your total profits or losses for a certain period of time. Once everything is in front of you, you might realize that something else is causing you to fall short of your goals. For example, maybe you exited several trades too early after losing money because you were feeling fearful after taking those losses. From a bird’s eye view, it’s easier to pinpoint where the real problems are coming from.

Categories
Forex Risk Management

Monthly Returns: Reviewing and Goal Setting

What is the satisfying rate of return that we can achieve during a period of one month? Do we really need to aim for any kind of speedy results? There are a lot of different types of traders out there, experts, professionals, beginners, people who trade just for fun, or people who think they are doing just great so they want to set some goals for the future. That part of pursuing the goals could be very tricky in forex trading. Naturally, we all want to be better and more successful in areas like trading psychology, money management, and trade entries. We want to acquire wealth and knowledge as well but for that, we need discipline and a killer strategy. Before all of that, we need to achieve patience, because that skill could be our most powerful weapon in most cases.

What is the satisfying rate of return that we can achieve during a period of one month? Do we really need to aim for any kind of speedy results? There are a lot of different types of traders out there, experts, professionals, beginners, people who trade just for fun, or people who think they are doing just great so they want to set some goals for the future. That part of pursuing the goals could be very tricky in forex trading. Naturally, we all want to be better and more successful in areas like trading psychology, money management, and trade entries. We want to acquire wealth and knowledge as well but for that, we need discipline and a killer strategy. Before all of that, we need to achieve patience, because that skill could be our most powerful weapon in most cases.

What is the satisfying rate of return that we can achieve during a period of one month? Do we really need to aim for any kind of speedy results? There are a lot of different types of traders out there, experts, professionals, beginners, people who trade just for fun, or people who think they are doing just great so they want to set some goals for the future. That part of pursuing the goals could be very tricky in forex trading. Naturally, we all want to be better and more successful in areas like trading psychology, money management, and trade entries. We want to acquire wealth and knowledge as well but for that, we need discipline and a killer strategy. Before all of that, we need to achieve patience, because that skill could be our most powerful weapon in most cases.

We are really glad to see people are starting to look at things in terms of percentage return and not pips when it comes to what we are able to achieve over a certain amount of time. Percentage return tells the tale pips probably not. We can hear every once in a while someone saying: “Oh, this robot gave me 350 pips a month, my trading signals generate this many pips every month”. This might be a very misleading number for a couple of reasons. One, we all know that pips have different amounts behind them which means we could make thousands of pips and on the plus side at the end of the year and still only hit 3 or 4 % of the return.

It doesn’t mean a lot. Two, if somebody is going to advertise a robot for example and say: “Hey, this thing made 10.000 pips in the month of November!” That could be true but what we didn’t know is that for example, the ATR of the pair we traded this week, the NZD/AUD was at 60 pips, the ATR for gold usually sits right around 1500 pips a day. It fluctuates up and down but on average that’s about where it sits. So to catch 10.000 pips for a month if we hit a really good trade it’s not impossible but it’s rather pretty improbable. But to tell something like this to an average forex trader might be super misleading.

People who are just getting into the forex world would probably believe anything you are willing to serve for them. Therefore percentage return could be that thing that we want to focus on. The percentage doesn’t lie, especially over a long period of time. The problem is that over a period of one year, for example, we are going to have up months and down months. That doesn’t suppose to be a huge problem. We all have those months, it is important to learn how to play the game. We are all aware of how the market is one crazy inconsistent beast. So to aim for any kind of monthly return might be a silly goal. We might drive ourselves absolutely insane because we are not going to get there consistently. Soon after we might end up frustrated and that emotion could easily lead us to take trades we should not be taken or we might go over leverage.

Traders, why we think trading the daily chart might be a good idea? Why we wait for our indicators to tell us to shoot? It’s because we have this awesome luxury of allowing the market to come to us. If it doesn’t come to us and there are no trades out there, we don’t have to take them. That is one of the biggest advantages that we have. So setting unrealistic profit targets for the month shouldn’t be the path we want to try walking along. A lot of traders and firms do things the wrong way. The traders are trading 15 hours a day on all sources of stimulus, getting very little sleep, and ending up with poor mental capacity because they have to hit these targets every day, every month. This could be short-sighted and pretty foolish because the market isn’t always on our side.

Not having something like patience could lead us to something like trying to have monthly profit targets which could potentially lead us to a lot of mistakes that we don’t want to be involved with. On the other hand, having patience allows us to do things the right way and at the end of 6 months period or even better 12 months period, we might be well-ahead of those people that were tearing their hair out trying to score their monthly profit target. If we want some real figures, if we want a real blueprint we might consider focusing on long-term results. We should never-ever force our trades, instead, we could try to give our systems a decent time of run and they might give us back a decent return. With a good money management structure, an ounce of discipline, and well-shaped trading psychology we could become unstoppable. Traders, think about that.

Categories
Forex Basics

Setting Realistic Trading Goals

Everyone that decides to try out forex trading enters the market with goals in mind. Often times, our goals revolve around turning a profit, like making a set amount in a given timeframe or earning enough income through trading to sustain our lifestyle. Others might want to become one of the very best traders out there and to have their name associated with the likes of George Soros, Paul Tudor Jones, and other trading legends. While being ambitious and setting goals shows that one has the self-determination and positive outlook, many traders set unrealistic goals that lead to disappointment. Some traders enter the market with starry eyes, only to give up on trading for good if things don’t meet their expectations. This is why it is important to set reachable short-term goals for oneself when trading forex. Below, we will provide some real examples of what you should expect.

Everyone that decides to try out forex trading enters the market with goals in mind. Often times, our goals revolve around turning a profit, like making a set amount in a given timeframe or earning enough income through trading to sustain our lifestyle. Others might want to become one of the very best traders out there and to have their name associated with the likes of George Soros, Paul Tudor Jones, and other trading legends. While being ambitious and setting goals shows that one has the self-determination and positive outlook, many traders set unrealistic goals that lead to disappointment. Some traders enter the market with starry eyes, only to give up on trading for good if things don’t meet their expectations. This is why it is important to set reachable short-term goals for oneself when trading forex. Below, we will provide some real examples of what you should expect.

Everyone that decides to try out forex trading enters the market with goals in mind. Often times, our goals revolve around turning a profit, like making a set amount in a given timeframe or earning enough income through trading to sustain our lifestyle. Others might want to become one of the very best traders out there and to have their name associated with the likes of George Soros, Paul Tudor Jones, and other trading legends. While being ambitious and setting goals shows that one has the self-determination and positive outlook, many traders set unrealistic goals that lead to disappointment. Some traders enter the market with starry eyes, only to give up on trading for good if things don’t meet their expectations. This is why it is important to set reachable short-term goals for oneself when trading forex. Below, we will provide some real examples of what you should expect.

Have Realistic Expectations for Profits

No matter how inspired you are or what you’ve heard, you can’t expect to become rich overnight or make a lot of profits from a small deposit in forex trading. The best goal starting out is to turn a profit rather than losing money. If you do this, then you’ll be off to a better start than many others. Once you are more comfortable trading, a realistic goal would be to see returns of 5% or less. Eventually, you will improve, and you’ll have more money to invest if you invest your profits, so you’ll see larger gains and you can set higher goals. At first, simply remember to focus on not losing money and know that some profit is better than nothing.

Don’t Think Trading is Easy!

A few minutes of research cannot possibly prepare anyone to become a forex trader. There’s a lot you need to know, so don’t make the mistake of opening a trading account too soon. Predicting market behavior isn’t easy, it takes a lot of knowledge to make good trading decisions. If trading were a quick way to get rich, everyone would be doing it. If you’ve already started and you’ve lost money, don’t give up. Just take a break from trading until you’re better prepared. Don’t think you’re going to become the best trader overnight just because someone you read an article that makes it sound easy.

Don’t Quit Your Job (Yet)

Forex trading inspires many people to quit their jobs. There are a lot of benefits to becoming a trader, including flexibility, not having a boss, being able to work from home or anywhere with an internet connection, and so on. Unfortunately, some people quit their job believing that forex trading will allow them to make enough to sustain their lifestyle. If you’re only starting out with a couple of hundred dollars or even a few thousand, you aren’t likely to make enough money to pay all your bills and take care of a family if you have one. Try out trading part-time for a while so that you can see firsthand how much money you’re going to make. Then you can decide if that amount meets your requirements. Don’t feel discouraged if you can’t afford to quit your job yet because this could be a longer-term goal.

Focus on Being the Best You Can Be

It isn’t about making the most money at first. The primary objective is to learn from your mistakes and to be the best trader you can possibly be. You don’t have to get the same results as someone you know so don’t beat yourself up over the little things! If you don’t understand something, research it. Keep a trading journal to log your mistakes. You won’t become the best trader out there with a little bit of practice, this is a long-term goal that takes a lot of time and hard work. If you aren’t willing to put in the effort, don’t become a trader. If you’re ready to make the commitment, then you should focus on short-term goals rather than only seeing the big picture.

The Bottom Line

Many traders walk away from trading for good because they come into the forex world with unrealistic expectations. This isn’t an easy way to get rich, it takes a lot of hard work and time. Starting with short-term goals and realistic expectations will make it easier to celebrate small victories. Remember that making something is the first goal, even if you don’t make much, you still worked for that profit and you should be proud of yourself. Don’t feel discouraged if you’re feeling more ambitious – eventually, you could make enough money to quit your job, become a well-known trader, or meet any other long-term goal you have set. Simply know that it might take more time to achieve those goals and that you’re off to the right start.

Categories
Beginners Forex Education Forex Basics

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

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 […]

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 […]

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.