Tag: FX Basics

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Forex Psychology

How To Get Your Trading Mojo Back

Your trading mojo can be a brittle thing, but what exactly does it mean, we have heard it in everyday life, someone has lost their mojo. Well to put things simply, it is another way of saying that someone has lost their confidence or their abilities to do something as well as you used to, […]

Your trading mojo can be a brittle thing, but what exactly does it mean, we have heard it in everyday life, someone has lost their mojo. Well to put things simply, it is another way of saying that someone has lost their confidence or their abilities to do something as well as you used to, […]

Your trading mojo can be a brittle thing, but what exactly does it mean, we have heard it in everyday life, someone has lost their mojo. Well to put things simply, it is another way of saying that someone has lost their confidence or their abilities to do something as well as you used to, and this is definitely relevant to forex and other forms of trading.

For any trader, there have been times where your confidence has been hit, either through a number of successive losses or even from taking a break. Being away from trading for a while and then coming back you will have no doubt forgotten something, this can also have a negative effect on your confidence and your own abilities to successfully analyse and trade.

The problem with losing your mojo is that it often escalates and continues in a downward spiel So you have had a few losses in a row, you now lose confidence in your strategy and begin to make trades that are not in line with it, these then continue to lose and put your account into the red, this further compounds the lack of confidence and can lead to either giving up or even obsessive trading without any real strategy which can increase the risk of blowing an account.

So how do we get this trading mojo back, how do we get out of the rut? The first thing that you will need to do is to take a step back, you need to be able to look at the trading that you have been doing so you can try and work out a few different things. Have you been trading differently? Are you still following the same plan and strategy? Has anything happened around the world that may have influenced the markets? Are you doing anything wrong?

Asking yourself these simple questions is a good place to start. It is part of the process of mending your confidence and will also allow you to work out whether you have changed anything giving you the opportunity to potentially change it back.

So taking a look back at the trades that you have taken. Hopefully, you should have been keeping a trading journal of the trades that you have previously made. You need to be able to look at which trades won and which ones losses, the setups for each one, and any outside influences that may have caused losses. It will take a lot of time but it will be worth it. Doing so may help you to identify certain patterns, both on the markets but also from your own behaviour. Being able to identify these will enable you to stamp them out, it may also go the other way and show that nothing that you did cause them to lose, if it is from outside sources out of your control, then it can be a way of confirming that what you are doing is actually right.

Check your stops and your take profit targets, could they be the cause of your losses, many people either set them too tight or too loose which can lead to missed profits or larger losses. Many people don’t start out with the right figures, it can take a bit of time to adjust them. They also need to be adjusted per trade, different pairs and different market conditions require different stops, so sticking them all at the same levels will no doubt lead to confusing results.

When losing, the worst thing you can do is go larger, instead, look at reducing the size of your trades, this can help ease any concerns that you have about losing more money. Knowing that any further losses will be much smaller can help you to get back into trading and to be a little more confident when trading. It is important to remember that when using smaller trade sizes, stick with them, don’t suddenly put them back up after a win or two, stick to the lower sizes until you have built your account back up to an acceptable level, at this stage you can begin to slowly increase the trade size again.

So those are a few ways to bring back your mojo and confidence, there is no doubt that you will lose it at some point, it is important to be able to recognise it and work on getting it back once it does happen to you.

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Beginners Forex Education Forex Basics

What Do I Need to Trade Forex?

We know why you’re here – you’ve heard about forex trading, and you’re looking to get involved. Forex trading can be a great source of future income and it can even replace your real job in some cases. With so many articles and tips out there, you might be wondering what you need to get […]

We know why you’re here – you’ve heard about forex trading, and you’re looking to get involved. Forex trading can be a great source of future income and it can even replace your real job in some cases. With so many articles and tips out there, you might be wondering what you need to get […]

We know why you’re here – you’ve heard about forex trading, and you’re looking to get involved. Forex trading can be a great source of future income and it can even replace your real job in some cases. With so many articles and tips out there, you might be wondering what you need to get started. It can’t be as easy as opening a trading account and becoming a millionaire, right? If it were, then most people would be doing it. The good news is that most of the things you need can be acquired easily if they aren’t already in your possession. Below, we will detail the 4 things you absolutely need to become a forex trader.

An Education

The first thing you need is to be educated, everything else comes later. There is no reason to open a trading account if you aren’t prepared to start trading because some brokers will charge you inactivity fees for letting your investment sit there untouched. You need to start with basics, like terminology. Then you’ll have to understand the mechanics of trading, as in how to do things like place orders, set your stop loss, and so on. Reading about trading strategies, risk-management options, trading psychology, how the news affects trades, etc. are equally as important. This is something anyone can do for free, so long as you have a working internet connection.

There are even different mediums out there for learning, like articles, eBooks, videos, webinars, seminars, trading courses, and so on. If something just isn’t making much sense to you at first, don’t give up. Try researching that subject through a different medium, for example, if reading the material doesn’t make sense, try watching a video. Otherwise, you could try looking on a different website to see if another author can offer a clearer explanation. Anyone can get a trading education if they put their mind to it, but you’ll need to understand that this will take hard work and dedication. You can’t learn everything you’ll need to know in an hour, an evening or even a day. It can take weeks and months to take in everything you’ll need to know. As a forex trader, you should always pursue a better education and continue to improve your understanding.

An Investment

Another must-have item every trader needs is an initial investment. The good news is that many brokerages will allow you to get started with as little as $5, or maybe around $100 or so. This shouldn’t be too difficult to come up with, so this still leaves the door open for everyone. However, you should note that you’ll probably be stuck with a Mini/Micro/Cent account or a regular Standard/Classic account if you’re making a smaller deposit. Most brokers market these accounts towards beginners and save better conditions for Premium, Platinum, Gold, VIP, or other similarly named accounts. Better accounts can ask for deposits in the thousands or even hundreds of thousands, which puts them out of reach for most traders. Fortunately, you can get started with as little as $5, just have realistic expectations. Don’t expect to make as much profit as someone that has invested $20,000 or more. You also need to be investing your disposable income, never try to invest the money you need to live off of. There’s nothing wrong with saving up over time if you’d prefer to enter the market with a larger investment.

A Device with Internet Connection

This one is somewhat obvious, but still worth noting. You need a smartphone, laptop/desktop, or a tablet/iPad with a working internet connection to be able to run the trading software. This won’t be too much of a problem for most traders – if you can read this article, then you probably have what you need. Of course, if you’re using someone else’s device or internet connection, you’ll need your own before you can get started. Try to be sure that your internet connection is strong as well, otherwise it could cause issues. Note that some providers will allow you to upgrade your package if it isn’t working fast enough.

A Broker

The last thing you’ll need is a forex broker. There are hundreds and thousands of them online and readily available. You’ll need to do some shopping and comparing, however, as some of them might charge high fees or require a deposit that is larger than what you’re looking to invest. Choosing a good broker is essential for success, so be sure to put a lot of effort into this step. Some brokers are more interested in individuals with a lot of funds to invest, but you should be able to find a beginner-friendly broker easily.

Conclusion

If you want to become a forex trader, the good news is that the things you need are fairly accessible. A device with a working internet connection and a broker are easy to obtain, and you can get your education online for free if you put in the effort. Coming up with an initial investment might be more difficult, but you can still get started with around $5 and work your way up to investing larger amounts later on in your career. Becoming a successful forex trader is an obtainable goal for anyone that is determined and willing to put in the hard work.

Categories
Beginners Forex Education Forex Basics

Why Do Some Forex Traders Ultimately Give Up?

The unfortunate truth about trading is that it is not for everyone, in fact, it is for the very few. Thousands of people take up trading each year but it has been estimated that one a very small percentage, around 2 to 5 percent of new traders actually continue to do it long term and […]

The unfortunate truth about trading is that it is not for everyone, in fact, it is for the very few. Thousands of people take up trading each year but it has been estimated that one a very small percentage, around 2 to 5 percent of new traders actually continue to do it long term and […]

The unfortunate truth about trading is that it is not for everyone, in fact, it is for the very few. Thousands of people take up trading each year but it has been estimated that one a very small percentage, around 2 to 5 percent of new traders actually continue to do it long term and actually make money. It takes a lot of time, money, and patience to actually become a successful trade and this is most likely why most people do not continue and stick with it.

So why exactly is it so hard to keep going, we will now look at a few of the most common reasons as to why new traders are so often giving up and why so few of them actually continue on to be profitable.

A Blown Account

Let’s get straight into the big one, they managed to blow their account, we have all been in this situation, coming in with wide-open eyes, thinking of all the possibilities and all the money we are going to make. Then things go wrong and we blow our account, most likely due to our inexperience, but whatever the reason is, it’s gone. Now we are annoyed, trading clearly isn’t what was advertised, we just lost our money and so we no longer want to trade. At this point some quit, others, they try again and inevitably the same thing happens all over again, some quieter and the cycle continues. Without wanting to put in the proper learning to understand why they lost their account, they will just give up instead and move onto what they think the next big money-making opportunity is.

Information Overload

We can see exactly where they are coming from, on the outside, trading can look pretty simple, the markets can go up or down, the news can affect it and so can Donald Trump, but once you actually get into trading, it is a whole other beast. In fact, we haven’t really come across anything which has more information available and different scenarios of things that can happen, of course, that is not including things like quantum physics or storyline from the Metal Gear games.

There is a lot, and it is enough to overwhelm anyone, especially someone coming into it that didn’t really know what to expect. Many people see all the information, the hundreds of indicators and then decide that it is too much, they do not have the time or the energy to start going through all of it, not to mention it is pretty hard to work out where to start too. So this bombardment of information is another thing that can cause people to step back and walk the other way.

They Suffered Some Losses

This is similar to the blowing on an account but often comes once someone has actually put in some of the work of creating a full or at least partial trading plan and strategy. They have put in a lot of effort to get it to the stage that it is at, then they begin to trade and they experience a string of losses, it may only be two or three, but it could be five or six in a row. This will hit their confidence, it would hit anyone’s confidence. Having put in all that work and then losing, it can make you wonder what the point was and if it is worth putting in any more. Those that feel that it is not worth it will stop at this point, others may realise that losses are as much a part of trading as winning, but the disheartening feeling of doing all that work just for losses is just too much for some newer traders. The good news is that at least they will have something to take out at this point before actually blowing an account.

A Bad Signal Service/Trading Robot

These days, trading is being advertised as being extremely accessible, and it is, the unfortunate thing is that it is being advertised this way by a lot of scammers and people who want to make a quick buck. They often do this by realising and then advertising either a trading signal service or an expert advisor that will enable someone with no knowledge of the markets to trade them successfully. Now, there are some legitimate robots and signal services out there, but those ones aren’t really advertised as aggressively, instead, most people see the ones promising returns of 20% per month or 90% accuracy of trades. When you see numbers so high, avoid them. New traders get into trading for quick money without having to put in any work, but like anything in life, the less work you put in, the less quality you get in return. These trades or robots go bad and an account is blown, it’s not as easy as it looks and the new traders leave.

Forex Trading is Simply Not Suitable for Them

Forex is not for everyone, in fact when I started, I hated it, but I stuck with it and grew to love it. Not everyone wants to stick around in order to get past that dislike stage. Often when you start doing something that you do not like, you simply put it down, walk away, and don’t look back. This is what people especially those that hate numbers often do with trading. This is perfectly fine, it won’t be for everyone just as sport isn’t for everyone, those that don’t like it will often leave within the first week or two.

The Profits are Too Low

A lot of people come into trading in order to make money, what they do not realise is that they actually need money to make money, which in all honesty, is how the rest of the world works too. Many people don’t realise that if you come into trading with just $100 to $1000 you are only going to make a couple of dollars a day at the most (unless you get lucky or risk too much per trade). So after a week or so, people begin to realise that this is not the get rich overnight thing that they believed or was told to them, this can put them off and so they will leave to look for something that can generate them some money a little quicker. Those coming in knowing that it is a very long term thing will be far more successful and more likely to stick around.

So that are a few reasons why people decide to leave, they are all very valid reasons, some slightly more unfortunate than others. Trading is a niche, either you will like it and stick with it, or you will not and leave. Whatever your decision, trading will be around for a long time, so even if you leave, there is no harm in trying again in a few years.

Categories
Beginners Forex Education Forex Basics

Reasons Why FX Trading Requires Dedication

When you started out with trading or when you had the idea of trading, how did you picture it? Did you think that you would start out with an hour here and there, or did you listen to those stating that you can work a couple of hours a week and make it big? If […]

When you started out with trading or when you had the idea of trading, how did you picture it? Did you think that you would start out with an hour here and there, or did you listen to those stating that you can work a couple of hours a week and make it big? If […]

When you started out with trading or when you had the idea of trading, how did you picture it? Did you think that you would start out with an hour here and there, or did you listen to those stating that you can work a couple of hours a week and make it big? If you had any sort of thoughts sling those lines then you would be greatly mistaken. Much like anything in life, if you want to be good at something it is going to take a lot of work and a lot of dedication. If you do not put in the work, you will not get the rewards.

The way that the forex industry is going, things are getting easier and easier to get into and to gain access to various things that in the past would have been pretty hard to come by. In order to get into trading now, all you need is an internet connection and a bank account. You can simply go online, find the broker you want, sign up, deposit, and start trading.

Things being easy to access does not however make them any easier to do. In fact, the number of people who start trading is increasing, but so is the percentage of those traders that lose money or blow their accounts. This shows that while it is easy to get into trading, it is not easy to do it successfully.

From the outside, it is always quite difficult to judge exactly how you will be able to deal with certain situations or to cope with prolonged exposure to something that can potentially cause stress or loss. People from all walks of life and from all sorts of professions take up forex trading in the hope of being successful, coming from different backgrounds and having different base levels of discipline and dedication cannot really prepare anyone for how much dedication is actually required to be successful.

So despite the ease of access and the heaps of educational and learning material out there, it should be easy to get to grips, but sadly this is not the case, you will need to work hard and you will need to put in the work.

The majority of traders come away from trading as a loser, they have lost either all or at least some of their deposits. This does not necessarily make them a bad trader. In fact, everyone that has even traded, even the most successful ones, have had losses, lots of losses. Part of becoming a successful trader is being able to encourage and force yourself to continue to work once you have those losses. It is very easy to just give up and think that this is not for you, however having the discipline and dedication to stick with it, even though those losses is what will ultimately make you a successful trader.

If you take a professional sports player, it takes years of practice to be at a level where they can actually make money, it is exactly the same for someone wand trading. You will have plenty of losses at the start. In fact, it will probably take you a year to be a break-even trader, but if you keep pushing and learning, just like a professional sports player, you will improve and you will begin to win some of your matches, or in this case trades.

There needs to be an understanding when you first go into trading that there will be a lot of losses and it will be a very long process. If you expect to be profitable when you first start out then you will be disappointed and quit, however, if you come in knowing that it will be a hard journey, it will be far easier for you to push through these initial losses and to continue learning until you are profitable.

Trading is an endurance event, not a sprint, you need that mentality and you need to be able to stick with it, if you want quick results, you will need to look elsewhere, however, if you understand that trading will take years of practice before you are truly successful, then it could be a good path for you to go down.