Written by: PaxForex analytics dept - Wednesday, 09 August 2017 0 comments
One of the key elements for successful trading is consistency. If we don’t trade consistently, we actually don’t know whether we should be changing, what we should be changing, or how we can improve. Many individuals that first venture into the world of forex trading do so because they believe that it is a lucrative way to make fast money. Some may even see early success in demo trading. However, the chances are that as soon they jump from being a demo trader to trading with a real money account, they begin to realize the cold hard truth that making consistent profits in the forex market is not as easy as they originally envisioned.
What normally happens is that people put a number of factors together and think they’ve developed a strategy. They assume that their combination is better than just trading on the basis of one piece of technical analysis. But when they put their various factors together and place a few trades, they find it doesn’t work. So they change their strategy. And that doesn’t work either. They end up stumbling from one poorly conceived strategy to another, looking for the one that works.
One of the main obstacles in learning how to be consistently profitable in forex trading is chasing the money. There is no doubt that forex trading can be profitable, but you have to be patient and realistic. A good place to start is to forget any unrealistic goals and targets. The notion of making large amounts of money off a few swift trades is extremely unlikely. If a trader does not
have any structure in his trading and always changes what he is doing, then it is impossible to improve because he doesn’t really understand what is going wrong. He will usually feel completely overwhelmed, does not know where he should start and keeps jumping around.
Consistently learning and educating yourself turns you into a more knowledgeable person who will probably make more money and be more successful than the person who chooses not to consistently educate themselves. Consistency in all aspects of our personal and professional lives ultimately ends up building habits, and habits are really what define each of us. If you consistently manage your risk correctly in the market and stick to your trading strategy and do not over-trade, you are going to develop some very positive and powerful trading habits that are going to result in you becoming a consistently successful trader.
Consistency in risk management is key….keeping your risk per trade consistent, is something that allows you to both keep your losses under control as well as your emotions. Traders who vary their risk a lot from trade to trade inevitably end up on an emotional roller coaster of trading that typically results in them giving back all their trading profits and blowing out their accounts. Keeping your risk consistent after a big winner or big loser is key and might be thee single most important difference between amateur and pro traders.