One of the biggest misconceptions that you can have about forex trading is that you can quickly start making a living from it in a relatively short period of time. If you have any hopes of eventually making currency trading your career, you need to disabuse yourself of this belief since it may eventually cause you to become discouraged and give up. The truth is, as with any career, you have to start small and then gradually build yourself up.
As we all know and are constantly reminded everywhere, 90-95% of traders fail. There are plenty of good trading methods out there that work (some better than others), yet 90-95% of people fail. Some of those statistics will be the gamblers who don’t know what they are doing and weren’t interested in learning properly anyway, many of them were probably tricked with get rich quick claims and don’t actually realize they are gambling.
The best analysis in the world won’t provide you the benefit you seek if you don’t have the patience to wait for the best set-ups. The problem that a lot of traders run into is that they would rather feel the action of being in a trade than wait for a great set-up that aligns with their strategy which is costly. Another problem that traders run into is not having a form of analysis that allows them to see when an appropriate time to enter a trade is present, even if the trend is clear.
Just because the forex market is open 24/7 doesn’t mean you should be trading that way. A novice will spend his days and nights entering and exiting trades, making adjustments and losing his money hand over fist. Once you learn patience with forex trading you will come to the realization that there are some times when it is just best to sit back and wait until the time is right. It is good to keep analyzing the market and adjusting your trading plans accordingly, but wait until the market is working for your particular strategy before making any investments.
You should know exactly what loss you are willing to accept and the minimal profit you are looking for with each trade. Another important aspect of patience in trading is the evaluation of your earning trades. Once you have opened a position and you see that it is almost hitting the take profit level, you are likely to want to close the position and take the profits there and then. Whilst you will get your profit quickly, you are preventing your trade from reaching its full potential so you could lose out on further profit.