If there is one feeling that currency traders universally abhor, it would probably be the emotion derived from watching a losing trade turn deeper and deeper against them. Unfortunately, losses are an inevitable part of forex trading and you cannot improve your trades or become a consistently profitable trader if you can’t accept that. There is no point in obsessing over a high winning percentage; instead you need to focus on cultivating your trading skills and seeing the bigger picture.
To become a successful trader you need to make a few adjustments to the way that you trade. By making a few adjustments to the way that you trade you can significantly improve your trades. There are countless traders out there who have little financial experience, yet they are consistently profitable on the forex market. These people adopt a few important strategies that enable them to focus on their trades with passion, commitment and dedication.
When most retail traders go through periods of many trading losses, especially larger losses, they would get into revenge trading, they would enter trades even based on nothing, not even setups that have high probability. All this because they think that the ultimate trade is now going to hit and get the account back up to profits. Unfortunately in most cases the opposite will happen. Possibly leaving the retail trader without trading capital or with just a nominal amount as trading capital after being wiped out.
While some traders might profit regularly from forex trading, others struggle to attain the same level of success. Traders who are consistently successful are able to handle losses efficiently, taking them in their stride and moving on with the next trade with ease. They are comfortable with periods of loss and are able to successfully trade with continued discipline, despite the losses that occur. These traders are constantly striving to improve their trades, by educating themselves and practicing relentlessly.
Whether looking at a successful breakout trader, trend follower or scalper. They all do the same thing. They all have a trading system and they stick to it. These traders don’t get emotional when they take a loss; they were trading according to their rules and the trade didn’t work out. They lost a pre-determined amount they were comfortable with and accept it as an unavoidable part of trading. They move on to the next trade, knowing their system is profitable over the long term.