Various people frequently question why some Forex traders trade successfully and some don’t. They moan and say, “Oh, they have all the luck. That must be the reason.” True enough, luck can be a factor in some trader’s success or failure in the Forex market to some small degree and over a short period of time.
As some ‘experts’ will state, trading the Forex market is akin to gambling. They both involve a great deal of risk and uncertainty. Unlike gambling, success or failure in the currencies market does not only depend on luck. It has a lot to do with two things: education and more importantly, attitude.
There is no question that education has a great deal to do with the success or failure of a Forex trader. Education transforms Forex trading into much more than just a guessing game. Analyzing trends, corrections and breakouts can assist the trader in making well-informed decisions; therefore increase the odds of trading successfully.
A really important contributor to the success of a Forex trader that is repeatedly overlooked is the improper attitude that many traders display while trading. Very often, Forex traders are victims of their own behavior. This leads to making wrong decisions, frustration and a great loss of money and energy.
What are these attitudes and how should they be dealt with?
Sadly, a lot of traders begin trading and investing in the currency market because they believe that they could get rich overnight as result of a small number trades. This is awfully far from the truth. In fact, successful portfolios are built over time.
If the trader does not realize this, than the trader may become discouraged and decide to assume more risk in order to make the huge gains that he or she had dreamed about. This is a definite road to disaster.
2. Refusal to being ‘wrong’
There is an indisputable fact for all Forex traders. We will be ‘wrong’ many times. Once we decide to become Forex traders than we must accept this truth and realize that being ‘wrong’ does not necessarily mean losing money in the long run. All we have to do is accept our inevitable losses and keep them to a minimum.
Trading Forex will not work out if one desires perfection or has the need to be right at all times. As traders, we have to remember that losses are inevitable. It is the overall, long term strategy that will produce profits over time.
3. Discipline is not optional.
Not all Forex traders can discipline themselves to continuously follow their Forex trading system through times of losses. In my opinion, the major reason for this behavior is because most people either do not take the time to properly develop a Forex trading system, or, they do not bother to back test it.
In order for one to follow his or her trading system, one must know without a doubt that the system is profitable and will produce gains over time. The key here is: knowing. Once a trader knows that his system might produce some losses at some point in time but that it is without a doubt profitable, than following it becomes easy.
As you can clearly see, trading Forex successfully is not all a matter of being lucky. Becoming a successful Forex trader is a profession that requires some investment of effort, education and time. Not all people naturally have all of the character traits that are required to succeed in this profession; however, all of the necessary character traits that are necessary are learn-able.