How To Become A Successful Forex Trader
My trading system ‘Green Tomatoes For Newbies‘ was inspired by the sheer number of emails I get every day from people who are looking for ways to make money from home to supplement their income or totally replace their job.
While I support learning how to trade forex, I want to make it clear that although it seems easy enough and simple, it’s actually a highly complex subject, and entails a real dedication to learning and practicing.
Become A Successful Forex Trader
Nobody gets to the point of living off their forex trading unless they have spent many many numbers of hours studying various indicators and watching chart price action… and actually placing trades in a demo account for several months, before using real money in a live account.
I don’t think anyone should trade with real money until they have achieved a win ratio of at least 50%. That means you’re consistently winning every other trade. If you’re using a 1 : 2 Risk to Reward ratio, meaning your target and take profit is double that of your risk, then you don’t need to be the best trader on the planet to grow your account safely.
HOW TO BECOME A SUCCESSFUL FOREX TRADER
Why a demo account first?
Well, first, you need to know how to place trades, and your stop loss and target, and possibly use a trailing stop…these are basic things and while it may sound simple, in some fast markets, it’s not that easy.
But the most important reason to start with a demo account, is for psychological reasons.
You see, the human mind is subject to fear. Specifically, fear of loss… and in forex trading, loss of money is a real fear that we all suffer from. It affects us in strange ways. The only way to overcome fear of losing money is to practice consistently in a demo account, with a slow increasing of lot sizes as our win ratio goes up.
Growing your demo account slowly demonstrates to your sub-conscious mind that you are capable of making good trading decisions and that there’s little to fear of you blowing your account. If you haven’t first convinced your sub-conscious mind that you can trade following the rules of your system and use safe and conservative lot sizes, then if you go too soon to trade in a live account with real money, your sub-conscious fear will not be under control and can lead to poor trading results.
Did you notice I said ‘safe and conservative lot sizes’?
I said this because it’s the most important aspect of how to become a successful forex trader.
Your sub-conscious mind is totally in fear of big lot sizes. While your conscious mind wants to win big and fast (this is another big problem of traders, it’s called Greed), and use big lot sizes to achieve this, your sub-conscious mind is really not comfortable with your actions… and if it’s not comfortable with your trading decisions and actions, it will find a way to try to stop you. Losing trades (and money) becomes the way your sub-conscious mind tries to stop you… before you lose your entire account.
So if you are feeling fear when you place your trades, it’s because your sub-conscious mind is using the one power it has to help control your actions: fear. When you feel fear, it means you’re about to do something stupid or wrong. And your sub-conscious mind is trying to protect you from harm or loss, it wants you to stop what you’re doing. Feeling fear when trading means your sub-conscious mind is not comfortable with your trading decisions and it wants you to stop, re-evaluate what you are doing, how you are trading, and try to develop better actions, or habits.
Because if you are trading with fear instead of confidence based on real tangible trading results that you first achieved in your demo account and subsequently in a live account using real money that you started out with small lot sizes, then your trading decisions will be skewed, your sub-conscious mind will not be supporting your actions because your sub-conscious emotional reactions will be stronger than your mental/emotional control… which can only be sufficiently developed and made into good automatic habits by spending enough time trading in a demo account and honing your trading skills… to the point that your sub-conscious mind is fully convinced that you know what you’re doing and your account is not at risk.
Once you have sufficiently developed good trading habits and have proven to your sub-conscious mind that your ability to follow the rules of your system, trade only when it’s the most lucrative time to trade (this is important, there are times when the market is flat and you should not be trading), use safe and conservative money management (reasonable lot sizes for your account size and leverage, which means a maximum of 5% of account equity per trade), and being able to stop trading for your session when you’ve lost your 50% win rate (meaning, stop trading when losing, and not over-trade with riskier bigger lot sizes to win back your losses)…
Then and only then should a trader start using real money. And the secret to keeping your sub-conscious mind feeling confident instead of fearful, is to start trading your real money with smaller lot sizes in the beginning, and then slowly raising the lot sizes so as to not trigger a fearful reaction.
If you do happen to feel fear, then you need to go back to your demo account and reduce your lot sizes and keep practicing with a 1:2 R:R and only after achieving a win rate of over 50%, should you go back to a live account. When you go back to your live account, reduce your lot sizes in the beginning and then slowly raise them as your win rate remains at least 50%.
If you cannot achieve a win rate of 50% in a demo account, you should not go to a live account with real money, you’ll just lose it. And if you are in a live account with real money, you must be able to achieve and keep a win ratio of at least 50%… and if you can’t, then you probably should not keep trading forex.
Not everybody can be a forex trader.
Mainly it’s because of the lack of ability to understand and follow rules. Not everybody can follow rules. It can be because of poor mental and/or emotional development &/or discipline. It can be a mental attitude of not liking to follow rules, or of being rebellious or arrogant, or of being too lazy to study and practice enough. It can be because of lack of patience… patience to spend the proper amount of time to learn and practice or keep a journal of each trade, which means mainly to learn from mistakes.
Pain of loss can be the best teacher.
And most people have a very real fear of losing money…. especially people with very little money, any loss is a big loss… so traders with a small budget or trading account need to be especially careful of following the rules.
A trader with a larger budget or trading account doesn’t usually succumb to the fear of loss as much, since he can safely absorb more losses, and his sub-conscious knows this… but he will probably start losing anyway because of another psychological problem: greediness and over-confidence, both of which can cause good trading habits to go out the window, with losses to follow. Keeping a huge trading account can actually go against you, as common sense might not prevail and without the natural fear of loss at work to protect you, you probably will be overly confident and cocky and not follow the rules of engagement…. which will always lead to losses.
HOW TO BECOME A SUCCESSFUL FOREX TRADER
Trading is a rule-based activity. So these are the goals of any forex trader:
- do not be greedy and lose your common sense;
- stick to your rules of engagement like a good player;
- practice safe and conservative money management;
- practice in a demo account until a 50% win rate is achieved;
- keep a journal of your trades and learn from your mistakes and successes;
- stop trading for the day if you have 3 losses in a row;
- don’t trade in a flat market;
- don’t trade on Sunday or Friday
- don’t keep a large trading account until your mental/emotional control is strong… $5 K to $10 K is large enough to trade 1 standard lot for 20 pips a day (as a starting example), which can give you $50k in gains each year. Only after successfully managing an account this size should you move on to a larger account… you have to prove to your protective sub-conscious mind that you know what you are doing and are acting safely in your own best interests and that it has nothing to fear.
I never trade on a Sunday nite, and I don’t usually trade on Fridays. There’s a good reason for this.
Sunday night there is usually no clear trend established yet. Also, explosive moves can happen on a Sunday when the market opens because of political or financial news on the weekend that caused a fearful knee-jerk reaction by the banks…. gaps and whipsaws can be horrendous and devastating.
Friday can be difficult to trade because of red news events and a general profit-taking before the weekend… jerky whipsaw fakeouts are common. Only experienced traders should try to trade the news on Friday morning… if you’ve gotten good with your trading system and you are proficient, then trading the news on Friday can be very lucrative.
PSYCHOLOGICAL HELP FOR TRADERS WHO WANT TO BECOME A SUCCESSFUL FOREX TRADER
If you are suffering from lack of being able to obtain and keep mental/emotional control and you are suffering from fear that include classic symptoms like ‘not being able to pull the trigger’, or not being able to follow the rules of your system or safe money management, or not being able to focus or concentrate, or not being able to control greed or cockiness, all of which can lead to poor trading decisions, then you need help.
And not just any help, because trying to be a good and successful trader requires a specific set of mental and emotional qualities, without which you just will never be a successful trader.
There’s the old common saying: “Trading is only 20% technical, and 80% psychological”.
So even if you’ve studied hard to learn the rules of your system, and you understand what to do and not to do, and you are learning from your trades by keeping a journal, you may still find that your success rate is not what you’d like… and/or you are feeling fear when trading… which is a clear warning sign that you haven’t yet developed the necessary mental and emotional qualities or habits that can lead to success in trading.
I’ve developed, with the help of a friend of mine who is an expert in guided meditation, a video that provides all the needed sub-conscious support phrases just for traders. As you use this guided meditation video daily for a minimum of 3 weeks, you’ll start to feel things change inside of you: your ease of following the rules will become evident gradually, your fear of loss will be gradually replaced by a feeling of confidence, your mental and emotional discipline and focus will increase, and your trading will become more and more effortless with an ever-increasing success rate.
All of this just by watching a wonderful and pleasurable video while a soft loving voice is speaking words of wisdom. Your conscious mind will hear the words and they will gradually sink in and become believable… and that’s when your sub-conscious mind will become re-programmed and the fear will subside… and your trading will start to become effortlessly successful.
It’s called trading “In The Zone”, a special state of brain wave activity which is brought on by a relaxed positive state of mind.
DO YOU HAVE A BURNING DESIRE TO BECOME A SUCCESSFUL FOREX TRADER?
If you’ve mastered the technical side of forex trading, but you still can’t make money, it’s because of your poorly developed mental/emotional control that leads to poor trading habits and trading decisions.
You can either quit… or get the help you need. If you don’t get help, you may as well quit. Not everybody is cut out to be a forex trader… there are lots of other easier ways to make a living.
Wanting to be a trader really, in essence, means you are a weird egg… who else in this world gets addicted to squiggly colored lines and candlestick formations and learning about various indicators and chart patterns, and market movements, etc. Let’s face it, forex trading can be addictive… but if you don’t have the necessary mental/emotional qualities developed, you’ll never be a successful forex trader… and if you don’t want to get help, you really should quit right now, before you lose your entire account and cause yourself lots of unnecessary emotional pain.
So if you have a burning desire to succeed as a forex trader, and if you think you need help with your trading because you are lacking confidence, focus, discipline and/or positivity, I’ve created a self-help guided meditation video for traders to help you get “In The Zone”… a zen state of complete relaxation and super-conciousness, where learning and behavior modification and results become effortless.
Learn to use your mind and emotions to build up a sharp trader’s confidence, discipline and focus, the three most important qualities all successful traders have in common.
Shift your mind, your thinking. Shift your life.
Our Happier Trader Guided Meditation Video for Successful Trading is designed to bring you into a Zen state, gently and safely, and will rapidly improve your trading skills and increase your prosperity, in all forms.
Achieving this Zen state is the secret all successful traders and entrepreneurs share.
This simple technique has been my trading secret for years, and I keep using it, as it is the key to my successful stress-free trading.
BECOME A SUCCESSFUL FOREX TRADER
The Happier Trader Guided Meditation Video for Successful Trading can help you become a better trader with no extra effort.
Visit my webpage to learn more and to access a FREE 3 minute introduction snippet of the full length 20 minute video:
Book mark the page and keep coming back DAILY to enjoy your FREE 3 minute intro video!
Dedicated to your trading success!
‘Trading from the beaches of Mexico… you can too!’
CFTC RULE 4.41 HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.
Trading Futures, Options on Futures, and Foreign Exchange involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. Opinions, market data and conditions, and recommendations are subject to change at any time. The information contained in this email does not constitute a solicitation to buy or sell by this Company and/or its affiliates, and is not to be available to individuals in a jurisdiction where such availability would be contrary to local regulation or law.
Day Trade Forex, LLC or Cynthia is not giving advice nor is qualified or licensed to provide financial advice. You must seek guidance from your personal advisers before acting on this information. Trading can result in losses. We will accept no responsibility for any losses you may incur, from trading or otherwise. Do not invest more than you can afford to lose.
Forex Trading is a fascinating vocation and can be highly profitable. Your success is in your hands and no one else’s. Trading in forex is a business and succeeding is directly proportionate to your ability to learn the rules, have the necessary mental and emotional discipline and patience, and use the proper tools and strategies of this business.
Forex trading is not a science, it is more of an art form, a learned experience where there are certain things you need to see and experience. You MUST have the necessary mental and emotional discipline and patience to increase your chances of success. Take your time to develop your personal trading style and methodology.