Beginners Forex Education Forex Basics

Why You Should Focus on Improving Your Trading Skills

Well, understandably, there are quite a few practical benefits you get from polishing your skills in trading:

While these are just a few perquisites you get from improving your trading skills, you should ask yourself what it is that you feel comfortable with or that you really need in your life.

Some people are fine with doing things halfway. They are at peace with what they have and they are not looking for more.

If you are not one of them, then great – we are going to go deep today.

Ok, so the first step is always to see what type of trading you are interested in.

This is a crucial point because depending on your trading style, there are many additional questions we can ask. For example, if you are a naked chart reader, we would not be focusing on your ability to test different indicators but on your ability to understand what the chart is suggesting.

Most of the time people don’t make any changes because everything is going well on the surface. As Idowu Koyenikan said, you must have a level of discontent to feel the urge to want to grow. Still, do we need to get there? Do we need to take a major loss just to see that something in our system is not working? It’s like with beginner traders who manage to get some unbelievable returns month after month only because of reckless money management. This, of course, is never sustainable and, just because they lack experience and don’t listen to experts, they face the consequences of their actions and choices real soon. 

You don’t want to get more than you bargained for and you don’t have to suffer. You need to be attentive to what your style of trading requires.

Therefore, the next step would be to see how you understand risk and how you manage it. This is vital for trading because, as a trader, you will soon learn that it’s not about winning but protecting your account from losses. The better you are at keeping your leverage balanced, the more in control you are of your emotions, but we will discuss this aspect of trading soon enough.

An excellent way to mitigate risk is to diversify your wealth structure (portfolio). As a trader, you have many different options – you can trade forex, stocks, bonds, ETFs, and so on. We cannot predict market behavior, but we can all agree on one thing – change is the only thing we can be sure of. The more you expand your portfolio, the further you are from putting all of your eggs into one basket. 

Now, to get to this point and level of expertise, you do need to invest in your analytical skills. And, even if you say that you are more of a learner from my mistakes type of person, you truly need to acknowledge your ownership in your growth. It simply isn’t enough to say that you made a mistake. The trading world is not that forgiving and your account will prove it sooner or later. 

So, how can we work on our analytical thinking? We journal our trades and we commit to backtesting and forward testing with diligence and a sense of purpose. You don’t have to like it but you do have to recognize its potential for it to work on a regular basis. Your notes are your strongest weapon because they help you track your progress, make conclusions, and think of additional tools, indicators, and strategies you can include in trading to improve your system and render better results. 

Also, make sure not to be too quick to make changes. Developing one’s skills is a process, not a pill you can take for everything to turn to gold. If you see that your trading plan is making you feel concerned, you should give yourself some space and base your judgment on a bigger sample size. You need more trades and much more notetaking to make such vital changes in your trading.

This, of course, will teach you how to do research. In the same way you had to discover different resources on how to trade, now you need to be a detective and investigate how your actions and decisions generated specific results. This process does not have to be dull if you don’t build up unnecessary tension inside and attach negative meanings to it. This approach will help you tackle one of the key trading challenges – ensuring that you have fewer, not more, losses. What you come up with after such research may differ from other traders, but it is nonetheless relevant for you as we are all essentially different people.

Additionally, as traders, we really need to develop an insight into what the market needs. We may think something is relevant but if our everyday trading experience points at some other areas or skills, we cannot turn a blind eye and expect the problem to resolve itself. Similarly, we should strive to learn the conditions under which the market is the most permeable and agreeable with what we aim to achieve. For example, you should learn that unfavorable periods, such as elections, are there to be avoided because we do not need any excess volatility; we need flowing waters and a supportive breeze, not full-blown hurricanes, tsunamis, and volcano eruptions. Unless you adore these risky opportunities.

And, last but not least, you should really devote energy and attention to understanding yourself. Traders are often their own greatest sabotage. If you don’t know what you react to compulsively and why you are like a baby on its own – innocent and dangerous to yourself. Luckily, we are very predictable beings, so if you just take a little time and focus a little more on your emotional reactions, you can learn a great deal about what you do to hinder your personal development and financial growth. Psychology is a fundamental step in becoming a professional trader and ensuring a consistent money flow.

Still, remember that even if you can tick all of the points we listed at the beginning of this article and throughout the previous paragraphs, there is always room for improvement. Often we procrastinate to a large extent because we feel that what we need to do is big – sometimes in terms of the time and effort, we need to invest and, other times, in terms of the importance of what needs to be done.

In case you didn’t know…

We want things to be so perfect, but what we don’t understand is that this lack of confidence won’t go away unless we do something about it. And, the more we push things aside, trying to ignore whatever seems to be bugging us, the more they resurface. It’s like with the Hydra, the monster from Greek mythology – if you cut one head off, two more would grow back immediately. This is how you alone let yourself play out a part in this vicious circle.

Now, we have two major contemplative questions for you:

Who benefits from you staying in this loop of never progressing?

What is bigger – the fear of success or fear of failure?

The psychological benefits are no less impressive or significant than the increase in money in your account. Always keep in mind that what is essential is invisible to the eye (Little Prince).

Trust the process and trust yourself

Still, if you ever feel overwhelmed with the improvements you need to make, just take one thing at a time. Take that notebook and write down one—three things that you can do each day to improve your trading skills. 

Good luck!

Forex Basics

What Are the Best Soft Skills for a Forex Trader Develop?

Soft skills enhance our abilities to adapt to our work environment and enable a smooth exchange of information or services. While traders are not standard employees one can find at a typical workplace, they still need to exhibit skills related to personality, attitude, flexibility, and motivation, among others. As forex trading is a rather solitary endeavor, unless you are overly dependent on your Twitter forex community or your trading coach, you still need to develop such skills despite the lack of interpersonal contact.

Unlike hard skills, the soft ones cannot be mathematically measured, but their quality lies in their ability to increase traders’ potential to see benefit from trading. Many traders who failed in this line of business attempted to approach forex in a simplified fashion, downgrading it to betting and, hence, substantially affecting the end result. Therefore, to be able to understand forex and ensure prosperity, adopting a variety of soft skills is a requirement. Since trading currencies is a unique sort of business, we are going to highlight the skills that have proved to fortify healthy practices, boost self-development, and increase returns. You will find this article to be divided into three major sections that comply with the natural progression of every trader’s experience, which you can use as a guide to monitor your own development and ensure profitable trades in the future.

Stage 1: Learning

At the very beginning of a trading career, each individual intends to find proper learning materials that would best support the acquisition of new terms, understanding of the market, interpretation of charts, and acquaintance with concepts such as strategy, indicator, and algorithm. To be able to facilitate this educational process, you will need to exhibit the willingness to learn and employ research skills extensively. In addition, to further build resourcefulness, you will also need to make use of critical thinking to be able to discern whether the information you obtained is applicable or useful. Some people like to be creative in terms of how they adopt the knowledge, so they will use post-it notes or turn to drawing, thus showing their eagerness, motivation, and respect towards education.

If you learn how to value the opportunity to learn, you will much more easily go over all other stages of trading development because every step is a part of a bigger process that takes time, patience, and effort. Last but not least, you will need to start seeing yourself as an entrepreneur and demonstrate leadership and management skills so that you can properly assign times of the day/week when you will focus on learning, regardless of other responsibilities you may have. While intrinsic motivation is quite rare, exploit curiosity and envision your goals and potential changes that can support a balanced learning routine and reveal the importance of building forex education.

Stage 2: Practice

At this stage, traders are creating a demo account, through which they can practice technical analysis and fundamental market analysis as well as test their strategies and algorithms. As can be seen from the previous sentence, analysis is a vital skill, which can help you learn how to determine when and how exactly to enter and exit trades. By demo trading, you are testing your ability to make tough decisions and manage situations independently. While some people may find it easy to draw the line, others will come to realize that they lack emotional preparedness and confidence to proceed with a trade or to end it. This phase is ideal for reflecting on your emotional intelligence where you will need to show honesty and courage in determining how your own emotional responses affect your overall trading. Being sincere with yourself will also allow you to make necessary changes that can only help you down the line.

Of course, to be able to track your progress, you will also find journal keeping to be an absolute must, where the skill of discipline can help you build a proper routine. Lastly, understand that each trade is similar to a project, where you are the project manager, responsible for the technical, the emotional, the budgetary, and the organizational side of things, and it is thus also your duty to monitor whether each step is taken at the right time. If we overinvest and disregard the alarming risk levels, our projects will fail. However, if we invest too little, these projects will never come to fruition, so we need to exercise control as well as money and risk management. Remember that the ability to adjust to new circumstances and balance other life roles and responsibilities will also determine how well you can direct yourself, plan your strategy, control your emotional responses, and build your trading stamina. 

Stage 3: Professional Trading

The last stage, or the stage where you are finally ready to trade real money, is the moment when all your skills and knowledge of trading psychology will be tested. By now, you have already shown dedication, persistence, attentiveness, resilience, humility, the openness to change, and the ability to be corrected and trained, among others. Here you will need, more than ever before, to show faith in your system, regulate your compulsions to make changes in the middle of a trade, and monitor your risk and money management so as not to overexpose for example. While you may have a plethora of other responsibilities, you will demonstrate the skill to work under pressure but with a clear mind, which may require you to follow expert directions on how to relax and prepare yourself mentally/emotionally before trading.

Since real money trading tends to awaken our deepest fears, you know that you may at times need to build your attitude more devotedly and work on your positivity, and you should find comfort in knowing that have already proved to be able to troubleshoot anything that needs fixing. Remember to employ critical observation skills when it comes to assessing your technical skills, results, and psychology, but also strive to nurture tolerance and accept your flaws as areas where you can keep growing and enhancing your trading experience.

While forex does imply a different and possibly either stricter or more lenient schedule, depending on what reality you are used to, use your soft skills to perfect your technical skills and maximize your returns. Not everyone finds it easy to plan and strategize although every person needs to bear the responsibility for overcoming his/her shortcomings. Intrinsic motivation, control, determination, and critical thinking can get you far, as long as you accept the role of being your own leader. As you can see, leadership and management, together with all other skills, need to be used comprehensively in all areas of trading development. Therefore, these skills are not stage-exclusive, so the skills we use at the very beginning will probably need to be used later on as well.

Motivation is equally necessary for the early stages of trading where everything is new and complicated and later on when we need to record each trade to be able to track our progress to ensure sustainability. If we desire to build a lasting forex career, it is vital that we think of currency trading as a real job where we have the executive role. And, even though we do not have different people to manage, we have just about the same handful of duties trying to balance different sides of our personality, our goals, and technical knowledge. To summarize, in order to build your trading skills and increase your profit, you also need to develop soft skills that will allow you to control yourself and your trades, keep journals regularly, invest in practice and troubleshooting, support proper money management, and fortify your sense of responsibility regardless of your life circumstances. 

Beginners Forex Education Forex Basics

FX Trading Skills That Are Used In Everyday Life

While Forex and trading there ultimately make money, and that is, of course, a huge benefit of it, there are a few other things that you pick up along the way that can then be transferred into your everyday life. These are skills that you can, of course, pick up in other ways, some people also naturally have them., but traders are often forced to improve them and they can be very beneficial in your everyday life.


Probably the most obvious skill that you will pick up is discipline. Trading and Forex are both very long processes, yes people come into it wanting to get rich quick, but those people are very quickly removed from the pool as they blow their accounts. Instead, the ones that are left are the ones that are able to wait, they are able to show great levels of patience. When you start out, you will create a trading plan, you will then be required to stick to that plan, even when things are very quiet, there will be times with no trades at all, even possibly days without any. Staying patient and preventing yourself from forcing trades that you shouldn’t put on is a fantastic skill to have.

You can then take that skill out into the real world, it will make you far more tolerable of a lot of things that are happening around you. People walking slowly, the bus taking a long time to come, or your food at a restaurant is still not here. Having developed these strong skills and discipline will allow you to cope with these everyday situations in a much calmer and much more sustainable way.

Controlling Emotions

There are a number of very strong emotions that you will experience when reading in the markets, the majority of them can actually have a negative effect on both your trading and your own mental health. When things are going well, it can cause a feeling of overconfidence, this emotion can cause you to start placing additional trades or increasing risks to your account, overconfidence can also take place in your everyday life, causing you to take additional risks in the things that you are doing.

Another strong emotion is greed, we all want more, but being able to control that emotion will do a fantastic job both in trading and within your own life. Wanting more than you have and throwing rules out the window is not a good direction to go in, we learn to avoid this by using rules within our trading plans, the same can be done in real life, learning to work with what you have rather than what you want can help to keep this in check.

When you let your emotions get the better of you, you often end up making some bad decisions, in anything you do, when you let your emotions take control, you won’t be thinking about the consequences of your action and so bad decisions are made, this is true for both trading and everyday life, so learning to control them is paramount.

Getting Out of Your Comfort Zone

Homans like to feel safe, we like to do things that we are comfortable with and when we need to leave that area of safety, it can create feelings of stress and anxiety. Trading forces you to leave that comfort zone, either by taking risks with your money or learning new things. Being able to do it regularly within the trading world will teach you how to weigh up the risks and rewards of doing so. You can then take that same mentality out into the real world.

Being able to push yourself to try new things will enable you to experience a lot of things in life that you otherwise would have missed out on, new foods, new activities, all these things that you are now able to experience.

So those are just a few skills and traits that you could learn from trading that you can take out into the world, there are of course many more, trading can teach you a lot of things about yourself which can benefit you out there too. So do not take the skills that you are learning for granted, they may be helping you far more than you think.