FOREX trading looks easy yet few succeed.
If you are thinking of trading FOREX then you need to consider the fact 95% of traders lose their equity quickly.
FOREX trading is difficult as it means you have think and act in a totally different way and adopt a different mindset to win.
Here we will outline some of the mistakes novice traders make in adopting the right mindset.
1. Hard work does not guarantee success
In most professions the more you put in the more you get out.
In FOREX trading however this is simply not true, you don’t go paid for effort, you get your reward for making winning trades.
Many people say “knowledge is power”
In FOREX trading the right knowledge is power and this does not mean working hard.
2. Systems have to be complicated
Nothing could be further from the truth.
In today’s world of technological advances that astound us each day, it is tempting to think that we can conquer the markets with science, but trading remains simple.
Simple systems can and do work best, as they are more robust in the face of ever changing brutal market conditions.
Don’t make the mistake of complicating your system.
3. Leave your ego behind
Most people have an ego and none of us want to look stupid, but if you trade you need to accept the market will make you look stupid on numerous occasions.
Be prepared to look and feel stupid, as the market does this to everyone.
4. Taking loses
Related to the above, people hate taking a small loss, after all if they leave it will turn around and they don’t want to look stupid.
In a leveraged market this ends in disaster.
A small lose becomes a big loss, then reaches a stage where a trader faces wipe out and has to take it.
5. You need to have the courage to make big profits.
Surely we all want big gains?
We all do, but:
Most novice traders lack the courage to make big profits..
As soon as they get a profit they get excited and want to take it before it gets away, the bigger it gets the more tempted they get to bank their profit.
Add in the fact, that there are retracements into open equity that play havoc with emtotions when open equity is eaten into and the result is a trader will bank a profit of a couple of thousand and be happy.
If they had the courage of their conviction, in many instances they could make £10, 20,000 or more, by staying with the trade.
Currencies trend for months or years and if you have the courage to trade the major trends you can make huge profits, but you need to follow them.
6. Someone else can give me success
This is the biggest mistake in FOREX Trading and is rooted firmly in human nature.
We feel safe in groups and we are used to consulting an expert on a whole manner of things in life.
In FOREX Trading this is a bad move.
You need to know what you are doing and have total confidence in your own ability, without outside inputs.
Buying an e-book for $100 or so, is not going to make you a winner, neither is agreeing with the majority of so called experts in the media.
Firstly, no one can give you success it has to come from within and you will only be successful if you are confident in something you know will work for you.
Furthermore, the majority are wrong, so why follow them?
Trade in isolation, its not a normal human trait but one that is critical for success in online FOREX trading.
Trading can be lonely, make you look stupid and play havoc with your emotions, but if you can adopt the right mindset, you can and will succeed and the best part is:
If you do the above the rewards are huge.
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Article Source:http://www.articlesbase.com/currency-trading-articles/forex-trading-psychology-getting-the-mindset-1521331.html
