Market knowledge and ability to understand analysis will only get
you so far in forex trading, but without the nerve to actively compete
risking your own money in the process you can never become a successful
Wagering huge volumes of money in a market as susceptible to
change is liable to cause a whole range of opposing emotions; fear,
excitement and anxiety just to name a few. Battling against your
emotions in order to complete a successful deal is one of the major
hurdles, which must be overcome if you are to become a trader able to
close huge deals and earn vast sums of money. If you can overcome or
even use these emotions to make trades on the Forex then a successful
career may be beckoning, but failure to do so will almost certainly
cost you a substantial amount of money and end any lingering desires to
progress in the busy world of exchange rate trading.
Initiating and closing a trade at the right times are the
backbone of becoming a successful Forex trader. If a person cannot
execute these deals at the right times, the psychological and financial
damage can be crippling. Missing a huge trend or sitting too long on a
good price, can be a demoralising experience, but one that many will
encounter during a career in Forex trading.
Entering at the right time is just one thing that must be
done correctly, but if you are unable to leave at the right time or
hold your nerve during the course of the trade, the implications are
potentially severe. For example accepting a small loss just before the
market rises can lead to a horrendous huge profit/loss ratio margin.
Similarly sitting on a currency price that is plummeting for too long
could be financially crippling. Understanding the Forex market and
having faith in your ability to judge a trend will pay dividends if you
hold your nerve, backing out at the wrong time can prove to be a
The fear generated by investing your own personal money is
the main thing that must be overcome. It is the culprit in so many
failure stories, people who just couldn't overcome their anxiety
investing unwisely, pulling out at the wrong time, missing a rise
completely, all result in failure and are caused by fear. Accepting
this fear, and using it to your potential will make you a stronger
trader, able to trade freely and enjoy the thrill of the exchange.
Fighting it will get you nowhere, understanding and overcoming it are
the best remedies to this baseless emotion.
Trading strategies will help you ride out the rough times and
capitalize on the good ones. Sometimes just taking a step back and
accepting a few losses will give you the energy and the knowledge to
attack the Forex with renewed vigour, and make some serious profits.
Accepting that sometimes you will lose out, you need to be able to take
the hits and roll with a punch, there are no guarantees in the trading
market, so being able to move on and start again is a skill that is
paramount to generating success.
Analysis and charts can only get you so far. You must first
master these things, and be able to correctly interpret the figures
that are represented in order to spot the trends and make your move.
But this all means nothing if you don't have the courage of your
convictions. If you are too afraid to buy and not sure when to sell
then a glittering career in market trading is likely to elude you. 'The
trend is your friend' but it means nothing if you firstly can't spot it
and secondly don't have the courage to back it. Knowledge, strategies
and overcoming fear may well be the 3 best ways to become to unlock the
door to becoming a successful trader. Without all 3 you will more often
than not become unstuck, so prepare, practice and evaluate everything
before taking the plunge in the complicated world of Forex trading.