Over the years, a lot of people have tried to trade Forex to see if they will luckily make money but in the process, these traders fail and vowed never to trade Forex again while the rest of them return later after several years. It is only the 5% left that make profit consistently in online trading. Does it mean that Forex trading is so hard? Why is it that many traders lose a lot of money in Forex trading? It is obvious that they fail to follow the strategies used by successful traders. However, there are factors that cause many traders to lose money.
Forex trading should be taken as a serious business and as a business, success can only be achieved once you are well prepared for it.
Here are the steps you should take to make profit consistently in Forex trading:
1. You must have the right mindset.
The first and the most important thing you need to do is to get the right mindset. You should have this at the back of your mind that you cannot get rich overnight by trading Forex. Forex trading is a very challenging business and like other businesses, you will definitely experience difficult times as you trade. So, if you don’t have enough patience to endure during the down times, it is better you stay out of the Forex market. Also, you must inculcate a good attitude. Why should you do so? This is because you have to respect the market condition and adapt to it and not trying to fight the market.
In the Forex market, money can be made when an opportunity to make money presents itself and certainly in the Forex market, money can’t be made out of nothing. So, Forex trading is not a flexible business because you can’t control the Forex market which is in contrast to what people think it is. But on the other hand, online trading can be a flexible business because you can be doing other relevant things while you wait for an opportunity to present itself. Lastly, if you are just starting out Forex, never you quit your job because it is risky, therefore trade Forex as a part-time business.
Online trading has the potential to generate a lot of money for you but it will not happen at once. Before you start making a lot of money that can sustain you, it will take some time and patience and so stick to your day job. Some individuals stick to their day job, even though they make more money in the Forex market than what they receive as their monthly salary. The good thing about online trading is that you can combine it with your day job.
2. Use a mentor.
Save yourself the stress by not visiting forums looking for a holy grail trading strategy. The common sense is, for you to gain the knowledge, you have to pay the price for it. No knowledge is absolutely free. You may see a great trading strategy that is available for free in some forums, but the detailed explanation about that trading strategy is not found. However, even if the information is available for you for free, a step by step guidance on how to use that strategy will not be found.
Also, in the process of moving from one forum to another, you will end up losing time, energy and money. Why is it so? This is because you have to implement the trading strategies one after the other and this will consume time, energy and money (if the trading strategies are used one after the other in your real account). At the end, the loss incurred is much greater than what you will benefit and so running from one forum to another in search of the holy-grail strategy is not worth it at all.
3. Be disciplined.
For you to make profit consistently in Forex trading or in any other business, discipline is needed. Most traders lose a lot of money simply because they fail to stick to their trading plan. Discipline is not a problem to some individuals but to some other people, it is a serious issue. Following a trading plan with strict discipline is very important. Building a successful business takes time and it can’t be achieved if there is no strong discipline.
4. If you experience a draw down, be strong.
Like I said earlier, a trader must be patient during difficult times. Forex trading is not the kind of job that pays you salary every single month. Definitely, you will experience losing streak periods in the course of your trading career. When this happens, most traders will definitely change their trading strategy. Or maybe they may not emotionally withstand the depletion of their funds when they face losing streak periods. The painful fact is there is no trading strategy that is always profitable in each closing trade and therefore every trading strategy no matter how great it is have strengths and weaknesses. So, you need to have a deep understanding of your trading method and avoid using that method when the market condition is unfavorable.
5. Consult your mentor if your trading performance is not encouraging.
If you have done all you could do and your trading performance is not improving, then you need to consult your Forex mentor for guidance. An experienced Forex mentor is ready to help you rectify your problem or provide answers to questions with respect to the trading strategy that he himself designed. And beauty of the whole thing is that they have an interactive forum where students can talk about the challenges they face.
There are some other measures I didn’t outline in this article however the five measures are the most important and should never be ignored. Other individuals usually say that Forex trading is very difficult or they can even regard it as a gambling game. People will start making negative statements about Forex due to the terrible experience they had during the course of their trading activity. But when they see you making money consistently in Forex trading, they may start changing their mindset. The negative statement people make about Forex trading doesn’t matter but what matters is that they are traders out there who are making money consistently in online Forex trading and you can achieve successful like them once you do what they do.