Traders write their trading rules based on what they have learn from the markets. In fact, trading rules are often condensed market wisdom. For new traders, trading rules offer a compass to navigate the troubled market waters. For advanced traders, trading rules open perspectives.The truth about forex is that it can be an intense and stressful undertaking that requires a strong control of your emotions. Learning to trade forex takes patience – it will take you time before you master the basics.
Those who lack discipline or make decisions that are not carefully thought through will quickly find themselves in a negative investment position. Those who do not adhere to sound investment principles or who allow emotion to govern their thinking will quickly find themselves losing a grip on their investments. However, those who follow sound investment principles will reap the benefits of one of the world's most liquid and influential markets.
One simply cannot succeed in trading without discipline. In order to be consistently profitable, you must have strict rules of operation in regard to your trading, and you must consistently (i.e., all the time) follow them. Follow your strategy, follow your trading rules, especially risk management and money management rules and you will be virtually printing money in your account. Forget your strategy and you will be virtually throwing money out the window.
Plan your trade so you can trade your plan. Preparation is the mental dry run of your potential trades - a kind of dress rehearsal. By planning your trade in advance, you are setting the ground rules, as well as your limits. If you know what you are looking for and how you plan to act if the market does what you anticipate, you will be able to be objective and stand aside from the fear/greed cycle.
Because trading is always full of emotions, you must have a trading strategy which includes a set of rules you stick to. This will help protect you from yourself. Just because the forex market is online twenty-four hours a day does not mean that you have to trade all that time. If you are doubtful, do not trade at all. Instead, analyze the market and use the knowledge you get to make more profitable trades in the future.