“bbmaforex.com” A currency Successful traders, also known as a foreign exchange merchant or Forex trader, is a person who trades, buys or sells currency on a foreign exchange. Foreign exchange currency traders include someone who is employed professionally for a financial company or a specific group, but they also include amateur traders who trade for their financial gains either as a hobby or for a living.
What makes them “Successful traders“?
Successful traders in the foreign currency market
The foreign exchange market, often referred to as Forex, is the largest financial market in the world. The daily trading volumes on Forex are usually more than 1,000 times greater than the combined total of all stock and equity trading markets around the world. Every currency pair around the world is traded through this large and highly decentralized forex market, with 15 regional markets and thousands of specialist traders.
Becoming an amateur Forex trader is as easy as opening an account with Forex brokers. Some of the largest Forex brokers in the US are:
- Interactive Brokers
Most U.S. stockbrokers offer Forex trading AS well. If now you already have a trading account in the broker, chances are you can start trading Forex rill through your stockbroker, in most cases simply by filling out a short online currency trading application. If you open a new Forex account, you will start by doing a minimal small deposit that has been determined by the brokers; Some brokers will open an account with as little as $100 deposits while others may require more.
Start Trading Currencies
Once you open an account, you start trading by selecting the currency you want to trade. The currency on the Forex always comes in pairs. As the value of one of the currency pairs rises, the other falls. Most novice traders have to trade only the most traded currencies, such as the US Dollar (USD), the British pound (GBP), or the Euro (EUR) as they are the most liquid and have the smallest spreads. Spreads are allegations that trading specialists, effective as intermediaries, costs both buyers and sellers to manage trades.
What does it mean to be successful?
Successful traders do not ‘Lose’
No Forex traders without any disadvantages. But there is a different difference between how the early traders lose and how successful Forex traders lose.
What’s the difference?
Most start in the Forex market seeing the loss as a bad thing. This is a way to signify that they are doing something wrong.
And doing something wrong is bad. At least that’s what we’ve come to believe in our life’s journey.
However, successful traders do not see any disadvantages as “bad ” things.
It’s also not something market for you. The Forex market does not know where you are entering or where your stop-loss orders are located.
Unlike you, the market is always neutral. So when you lose, it’s a problem reflecting what you can do better.
Don’t get me wrong, nobody likes to see trades go against them. I don’t care if you have been trading for a month or ten years, it’s always more fun to make money than losing it.
That being said, just because trading doesn’t go your way doesn’t mean you have to take it personally. Thinking this way will only dig a deeper hole.
Successful Forex traders have a mindset that losses are just feedback.
This is the market way to prove trading arrangements. That’s the only Forex market can do because you don’t know anything about you or where you enter the market, nor do you care.
Losses can be a powerful way to learn. Just remember that even trades that end as losses can be the right decision.
How successful are forex traders?
If you’ve determined your edges, and the settings meet all your criteria for entering the market, then you do everything you can. The rest is up to the market, and a few days the market just doesn’t play together.
The next time you lose, take it as constructive feedback. Analyze the situation to see how you can improve next time. Remember, though, that even A + setup doesn’t necessarily work out.
I’ve had many trade setups that didn’t work that I would gladly take weekly.
That’s because I know that my edge will win over time and put money in my account. A good exercise after losing trade is to ask yourself, “Will I take the same setup again next week if it is presented on its own?”
You should always be able to answer this question with the “Yes ” sound.
If you answered with a “no “, you need to take a step back, determining where it is wrong and fix it for the next trade.
Start seeing trade losses as a business investment rather than an annoying event. Every loss is an investment in your trading business and ultimately your trading education.
The money you put on risk on a particular trade, whether it’s $5 or $500, is investing with the best Forex coach in the world market. Stay open-minded and it will show you all you need to know.
Most of them are successful using Price Action
Every successful forex trader I have met using price action in some way, shape or form.
This doesn’t mean they use price action the same way I use it, but they use some form of price action as part of their trading strategy.
Whether traders use raw price action or just use it to identify key levels in the market, price action plays a major role in any strategy.
That’s because it serves as a representation of psychology in the market. This gives us some insight into the minds of other traders.
Having a few ideas where buying and selling orders located on the market is crucial to becoming a successful Forex trader. This can strengthen trading strategies by providing an area to see potential entries as well as profit targets.
Trade Forex without using some form of price action like trying to drive a car with one eye closed. This can be done if it is really, but I would not recommend it.
So even if you are developing a strategy based on indicators, it will be possible for you to learn about price action. If nothing else, it will give you a solid foundation from which you can design and develop other strategies.
They have the terms in Edge trading
I see a lot of talks on the internet about the need for traders to develop edges and define them. And, if I am honest, most of what I have read out there is quite alarming.
It’s a little wonder why so many traders struggle to understand what the edges are and how they can develop one of their own.
So what exactly is the trading edge and why is it important?
The Edge is everything about the way you trade that can help put opportunities in your favor.
This is a combination of the timeframe you traded, the price action strategy you’re using, the level of key you’ve identified, your risk of reward ratio, and other factors. It even includes pre and post-trading routine.
How do you handle losses? What do you do when you benefit? These are all the things that makeup within you and your trades.
Think about something like this.
What enabled Brazil to win so many World Cups in football (football to most of the world)?
Is it passing? Maybe shooting?
That’s everything. Brazil has “Total package “, as they say. It’s passing them, shooting, Dribbling, ball movements, arranging the drama and everything in between that gives them an edge over other teams.
Your trades are no different.
While there are dozens of factors that make up the edges, you don’t have to master them all at once. You also don’t have to master all of them to start placing opportunities in your favor.
It is better to master a set of factors and then slowly expand into others to better determine your edges. Not only is this a natural progression, but it is also the preferred way to learn.
If you try to master too many of these factors at once, you set yourself up to be good (not great) on many things. That’s not what we want.
Instead, master one thing at a time. For example, be expert in identifying key levels. Then expand your assigned skills by learning how to determine the strength of the trend. After that, set your focus on learning about the pin bar.
These three things are all you need to witness the improvement of your profit curve. Keep expanding your skills this way and soon you will have your trading edge.
The key is to only handle one or two factors (at most) at a time. Using a slow and steady approach will get you on your way to becoming a successful Forex trader in a short time.
They did not try too hard in the market
But trying hard is what it takes, right?
This may apply to other businesses in life, but Forex is an exception. Successful Forex traders know that trying too hard is a sign that something is not true.
This is different from hard learning. As a new trader for Forex, studying the market is highly recommended.
For example, you can’t spend too much time learning the intricacies of different currency pairs, or how to draw key levels. The harder you try to learn a particular topic, the better.
However, attempting to make a trading strategy work will only cause destructive behavior, such as emotional trading. Similarly, trying too hard to find trading opportunities is a good way to lose money under standard setup.
Jack Schwager, the author of the Market Wizards series, says the best when he writes, “Good trade should venture “.
I’m a big fan of this book series. I wrote a post featuring some of his books.
When I first started trading Forex, I remembered spending a lot of time learning setup over the weekend. I often come back to my trading table several times on Saturdays and Sundays.
Then on Monday, more often than not I would end up taking a completely different trading setup just to watch the original trading idea move in the intended direction without me.
Does that sound familiar?
It happened because I tried too hard. As soon as I stopped over-analyzing the trade setup and trying to make them work, my profit curve started to rise.
Now I spend maybe 20 to 30 minutes per day looking at my charts – exceptions to be graphs I post on this website, of course.
As opposed as it may seem, learning not to try so hard is one of the things that completely change my trading career for the better.
Successful Forex traders have noted this, which is why they let the market do the heavy lifting for them.
They think in terms of risk
This is often the smallest thing in life that produces the biggest improvements.
The concept of thinking in terms of money is risky, as it applies to Forex trading, is no exception. This is a very simple concept that can have a huge impact on your journey to becoming a successful trader.
I’ve never met a successful Forex trader who doesn’t calculate their risk before placing a position.
You might think that a statement is obvious, but a surprising number of traders don’t think about how much money is at risk before opening a trade.
This is because they use an arbitrary percentage to calculate risk, such as one or two percent of their trading account balances.
Think about your last trade for a moment. Do you determine the exact dollar amount of risk before placing on the trade? Or are you more focused on the number of pips and percentage of your account at risk?
The convenience of the forex position size Calculator has made it so that we never have to consider the number of dollars being rectified. This comfort has led to great supervision.
Make no wrong, I used a position sizing calculator on the link above before each trade.
However, I’m only interested in the dollar amount at risk as a percentage of my account balance.
Aren’t they the same?
Yes and No.
2% of the $5,000 is $100. In that respect, 2% and $100 are essentially something of the same.
However, in terms of how our minds feel two numbers, they are on the opposite end of the spectrum.
I wrote an article some time ago called, pips and percentages will only get you so far. In it, I am talking about the need to think in terms of money risking vs pips or percentages.
This is because pips and percentages do not bring emotional value. So when you define risk on trading as a percentage only, it triggers the logical side of your brain and leaves the emotional side looking more.
When you calculate your risk as a percentage only, you define your risk, but you don’t accept it.
As soon as you convert that percentage to a dollar amount, your mind can visualize what it looks like $100. It allows you to determine if you are ready to lose that $100. In other words, is the trading setup that is meant to be good enough for your $100?
It’s much easier to take a 2% risk without fully accepting the potential loss for not carrying the emotional value of that money.
Successful Forex traders know this. That’s why they always define risk in terms of percentages and dollar counts.
They don’t need money
There are not many guarantees in the Forex market. But one guarantee I can make is that no successful Forex trader is traded today for the money he needs tomorrow.
In other words, trading Forex to earn a certain amount of money in a certain period.
I am not saying that you can not produce the majority of your income from Forex trading and do it full time. Such a statement would be contrary to my own experience.
What I am saying is that no successful Forex trader needs a win today to pay the electricity bills tomorrow.
No trader can sustain such pressures and become consistently profitable. This type of environment will only drive destructive emotions such as fear and greed.
This topic brings us back to the idea that successful Forex traders don’t try too hard.
If you need money from trading to pay bills, chances are that you will feel depressed to win. If you feel depressed to win you will try too hard rather than letting the market to do the heavy lifting.
The bottom line is this…
You only have to trade with the money you are ready to lose. Don’t trade with the money you need to pay for rent or provide for you or your family.
Similarly, don’t let money be your only reason to trade. The desire for money may be what draws you to trade in the first place, but don’t let it be your only wish.
Embrace the challenge and focus on the journey to become a successful Forex trader and the money will follow.
Let money be a by-product of good trading.
They know when to walk away
Of course, I’m referring to taking a short hiatus, not walking away for good.
All successful Forex traders know when to walk away and rest. Those who are very passionate about Forex trading know how hard it can sometimes run away from the market. However, it is necessary to become a successful trader.
Walking far can be very difficult after trading. This is because our emotions run high and often get the best of us. But that’s what makes walking away today very rewarding.
After profitable trades
After winning, we feel good about ourselves and our trading strategy. It felt like something was finally starting to click.
Walking away today can be difficult. The natural tendency after winning trades is to continue trading.
However, that’s why you should walk away.
Taking a break after winning will allow your emotions to settle. After winning, you feel happy and proud of yourself, and you have the right to be.
But since you may know, pride and excitement can get you in a pile of trouble, and quickly.
So next time you have a winning trade, pat yourself on your back and then walk away. By the time you come back to your trading table, your emotions will be restrained and you will be ready to approach the market with a neutral mindset.
After trading losses
What do you do immediately after the loss?
I can not speak for you, but I know what I used to do. I’ll soon start going through all the charts I’m looking for a new setup to restore what I’ve just lost.
Whatever you do, don’t do this. This is just your ego drawing you to one of the most common and expensive traps in the Forex market.
If you do this, it means your emotions get the best out of you.
Instead of seeing losses as the reason for climbing back into the market, take it as a signal to see what you can do differently. Remember, it’s just feedback.
One reason the failure rate so high in the Forex market is that traders have not learned to lose.
Your emotions will always try to outweigh your logic after a loss; It’s human nature. The key to being successful is not about eliminating emotions after a loss, it’s about channeling them in a way that will make you a better trader.
Successful Forex traders know this and have learned how to control this emotion. The first step in controlling your emotions involves walking away briefly.
One thing I have found helpful after trading is to shut down my trading platform until the day closes at 5 pm New York time.
Not all brokers offer New York near charts, but you can go here to get access to the same style chart I use.
This is when I do most of my analysis anyway because I trade a daily timeframe, so it makes sense to take a breath until then.
It’s simple, yet helpful, how to control your emotions.
They don’t focus on profit and loss
You can not visit the Forex site today without seeing an advertisement for some promising strategies 98% win the rate.
Why is that? Is it because a high win rate is required to become a successful Forex trader?
Not even close!
They do it because they sell. People who like to win, no one denies it. If you’ve ever played sports or watched your favorite sports team on television, I’m sure you can relate.
They are behind the so-called strategy that resulted in a 98% win advertised to know this and exploit to make money.
Nobody will be interested in spending money when they see the title promising a 50% win rate.
But what if it is a strategy with the right risk to reward ratios that are aimed at $300 for every $100 risked?
At a win rate of 50%, it was a 20% profit on the $5,000 account for 10 trades.
Successful Forex traders know this. They’ve realized long ago that it’s not about winning a high percentage of the time.
It’s about maximizing the amount of money made on winnings and minimizing the lost amount of money on losers.
As George Soros once said…
“Not whether you are right or wrong, but how much money you make when you are right and how much you lose when you are wrong”.
They never give up
Although this one is last on the list, it is most important to your success as a trader.
I have found over the years that many people, including Forex traders, lose sight of this very simple fact. The only way you can fail in becoming a successful Forex trader is if you give up.
This sounds obvious, but it amazes me how often I see persistence and grit left from a list of reasons why certain traders become successful.
You can not fail if you do not stop.
That brings us back to the first part of this post where I mentioned the passion. You can’t expect to achieve Forex success if you give up, and you can’t expect to survive if you don’t have a passion for trading.
You must have the desire to burn want to succeed as a trader. Not because you want more money, but because you love trading.
Of all the ways to make money in this world, trade is arguably the worst option.
It may surprise you coming from me, but of all the things I have accomplished in my life, nothing is approaching being as difficult and unforgiving as a successful trader.
I am not saying this to break your spirit, but rather to prepare you for what is ahead.
In all honesty, though trade has been the most challenging endeavor ever done, it also became the most valuable.
Who is the best trader in the world?
Maybe you’re familiar about George Soros or Paul Tudor Jones, but do you know who Bill Lipschutz is? In fact, there are many world-class traders who lack a spotlight other than Soros and Jones. This is not a coincidence, but it is intentional. Those who succeed in Forex do not want to be exposed and just want to enjoy their wealth secretly.
- George Soros
- Stanley Druckenmiller
- Bill Lipschutz
- Bruce Kovner
- Paul Tudor Jones
End of Word
Whether you have been trading Forex for a month or five, I hope the nine successful trader points you have just read will help you on your journey.
The most important Takeaway from today’s post is that there are no secrets to successful Forex trading. Sure, there are a variety of tips that can help you, but those who have achieved consistent gains are not touched.
In other words, there is nothing they do that you cannot eventually replicate.
However, if you intend to raise in rank and join the 5% of successful traders, you must be ready to put in the work and devote the time it takes to succeed.
Embrace the journey, because there is no finish line. Even those who have achieved consistent gains have a lot more to learn. Something less will not be beneficial.