“Forex trading is very difficult. I rarely have a winning trade!”
“Forex trading is so easy. I have another winning streak for the whole week!”
Two Groups of Forex Traders: Losers and Winners
Read the previous two statements again. These are two of the top statements I often hear from friends who are trading forex. Diametrically opposed, these two statements are in stark contrast to each other: a group of traders find forex trading very difficult for them, barely able to land a winning trade. Traders in this group are fumbling for the ropes, trying to become profitable traders and be able to bring home the roost. The merchants of another group are the happy ones. They are consistently profitable in their trades. They are the winners in the forex market.
You look around and see that others are doing so well at forex trading and accumulating personal wealth, even trading for a living, some of them make thousands of dollars every time they trade, and you think you should be one of they.
Why 90% of Forex Traders Are Losers
So why don’t 90% of forex traders make money consistently? What is it about the other 10% of traders that makes them big winners?
Forex trading was until recently the domain of the super rich and large institutions. Unless you are well-oiled and have deep pockets or a large sum of money as back-up capital, you probably won’t even get into forex trading.
However, this changed over time, especially when forex mini accounts were created, which led to an increase in the number of people wanting to trade forex.
This led to a problem… and the problem started to get bigger and bigger and exists to this day.
Forex trading is simply exploding, with over $2 trillion worth of currency transactions every day, and this rapid growth brings trouble.
A lot of people are getting into forex trading without proper training and proper education as traders. Easy internet accessibility made it worse. Many beginners simply explore internet based websites, picking up bits of forex trading knowledge here and there and started trading. It’s not that self-education isn’t enough, but the nature of forex trading is such that those who are successful traders just don’t know how to trade. Most of the successful traders are traders, their time is occupied by their trading and research on trade setups and they don’t have time to promote their trading signals on the internet. To them, they are first and foremost traders, not educators, and there is simply no reason to publicize their skills or reveal their secrets to trading successfully for free on the internet.
Easy access to the Internet has led to a proliferation of websites featuring some common trading systems supposedly useful for forex trading. The popularity of forex trading has led to a viral duplication of these websites with almost similar content, until a vast majority of forex traders who got their “education” and training from the internet are concentrating on such systems, not knowing exactly when are they appropriate? for use and when they should not be used at all.
Among other factors, this is one of the main factors why the vast majority of self-taught forex traders either do not make money or are inconsistent in their trading at best. Most of them are simply using the wrong tools or the wrong trading systems and have not mastered their trading or themselves.
Sun Tzu’s Art of War Provides the Solution to Your Business Depression
Sun Tzu’s The Art of War provides a key solution to a successful battle, which can be extrapolated to forex trading.
Sun Tzu’s Art of War called it: “Know your enemy”
And your enemy in forex trading is simply the forex market itself and you, the person yourself.
To win in the forex market, you must know the forex market itself; In other words, you need to understand the currency pairs that you are trading. Spend time studying your price movements. Learn what trading patterns and setups occur over and over again in those currency pairs. Familiarize yourself with the risk-reward ratios of each specific trading pattern for the currency pairs you are trading. Define and apply a specific trading strategy for the currency pairs you trade. Know when to enter and exit the market and when to stay out. The best way to ensure that you are doing it correctly is to get another experienced and successful trader to guide you or show you the ropes. Budget to learn before you trade.
As for the other part of the battle, you need to see the part of yourself that is the enemy. Forex trading involves decision making where your risk tolerance is tested, where the emotions of greed and fear will play a daily tug of war within your heart. The solution to win this emotional battle is to operate with discipline. Adopting a winning strategy, a winning plan complete with risk management and making sure you don’t deviate from that plan is a must for you to win. Once again, ask your mentor to show you and fine-tune that business plan.
You can join the 10% of forex traders who are consistent winners and start creating a steady income trading from home, away from the rat race if you are prepared to learn.