Trading Forex, or any other financial instrument for that matter, requires learning. A lot. You need to acquire new skills, continually research market conditions, learn how to analyze trends, evaluate your trades, etc. There are hundreds of courses available to teach you the technical aspects of trading, but the following 5 lessons, are those learned by traders the hard way, with experience, with winnings and losses. These are the things you won’t find in a text book.
- Trading Forex can be one of the most exhilarating and emotionally consuming things you can do while keeping both feet on the ground. The rush you’ll get every time you open a trade and win or the low you’ll experience when having a loss can be energy draining and trying to control your frustration, fear and greed can be difficult. Be prepared for the emotional rollercoaster.
- You cannot control the market. The Forex market sees over US$5.3 trillion traded each day and it is impossible for one person to cause an impact. Trading Forex however is not about changing the current, it’s about riding the wave.
- Greed can break you. Greed can be a great motivator, but when a trade is going in the right direction and you refuse to cash in thinking the trend will continue to benefit you so greatly that you will be set for life, greed can turn against you.
- Be patient. A trend may move in different directions before stabilizing and settling. As long as you have determined your worst/best case scenario and calculated your risk by establishing a Stop Loss and Take Profit points, you shouldn’t fret by seeing the market swing back and forth.
- Take some risk. Trading Forex is a risky business by nature and while there are ways in which you can cover your behind, avoiding risk entirely is impossible. Unless you don’t trade, which makes this a moot point. If you are trading however, don’t be afraid of a little (moderate and measured) risk.