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What Goals Are Realistic in Forex Trading?
Written by: PaxForex analytics dept - Wednesday, 19 June 2019 0 comments
Most of the beginners want to earn huge amount of money in a short time span and they find Forex market to be an attractive option. When you start currency trading online, you might have a lot of doubts and questions as to how does Forex work, how to build strategies, what kind of goals to set, etc. Before you start trading, it is important to have knowledge about the market. But what is more important is to set goals. Setting goals are important as they stop you from overtrading and also saves you from incurring losses. When the goals are decided in accordance with a certain set of parameters, it becomes easier for the traders to ensure that sufficient amount of earnings is made.
Goals are important! Not only do they represent expectations and aspirations, but goals also serve as a bridge from reality to the ideal. The moment you set a goal, you face reality by acknowledging the need to address your shortcomings or maybe simply fulfill your desire to do better. By putting in a substantial amount of effort that consequently leads to progress, goals keep you grounded when you see that it’s the little things that can make a big difference in the long run. These types of goals help reinforce and shape your trading skills so that you learn to trade properly.
As a beginning trader, a realistic goal is to trade your account as a learning exercise and not just for the intent of making a profit. Learn as much as you can so that you don’t lose the money, leading to faster and longer-term success. Whether you are a beginner or a seasoned trader, you should have a goal of putting the focus on the process of trading and becoming a good trader, not on your account balance. Its goal
is more applicable to your unconscious mind because you have to train yourself to be focused on the trade setup, the price action, and the overall chart picture, as opposed to the money and profits that so many traders become fixated on.
In business school, you are taught that to start a business you need a business plan. Trading is a business. Therefore, every time you trade you must be trading according to a well-thought-out and calculated plan. The plan should include how trades will be entered and exited and how the money will be managed. The plan should be very detailed, outlining the markets that will be traded, risk parameters, if filters will be used on trade signals, what constitutes a trade and exit signal, position size, what market environments will be traded, and how that will be determined, such as ranges or trends. Therefore, the goal here is to create a complete plan before making another trade.
When starting out, be a niche trader focused on very few manageable goals. Results will come in time if you are trading according to a trading plan, not trading when there are no opportunities. As a general rule, goals in the Forex market should be defensive. In other words, they should focus on protecting the capital you have rather than attempting to gain additional money. Let making money become a natural byproduct of the process you construct. It’s okay to set goals for financial gain, but only once you have perfected the process. Moving into this later stage of goal setting too soon can be extremely disruptive to your trading career.