Forex Trading Strategy - Check Yours Contains Points Enclosed or You Will Lose!
If you are thinking about trading, you need to consider that 95% of traders lose and if you want to win, check that your forex trading strategy contains all the elements below, if it doesn’t you will end up with the vast majority of losers…
1. Your System
Most traders think they can simply take someone else’s system and follow it blindly and don’t question the logic and here are 3 sure fire ways to lose doing this.
a. Following a Forex robot with a simulated track record
b. Following a day trading or forex scalping system
c. Following a scientific system or one that is supposed to predict prices
The above are what the majority of new traders do and they lose.
Your system means one that you understand from top to bottom and can have confidence in and one that you can follow with discipline. You need a system based on sound logic you understand.
Sure you can take elements of other peoples systems but you must understand why it gives you a trading edge.
2. What Edge Does Your System Give You?
Ask yourself this question:
Why should I succeed when 95% of traders lose?
If you can’t give a good reason of why your system, gives you an edge over 95% of losing traders, you simply don’t have one, so continue your forex education until you do.
3. Money Management Rules
Most people think money management is simply placing a stop but it isn’t.
If you believe it is, you are going to lose. If you don’t get your money management right in your strategy you are gong to lose.
You need to have money management strategy for the whole account, you also need to deal with standard deviation of price or volatility, you also need to have reasonable equity to start with and decide leverage on the account.
How many traders start with couple of hundred of bucks, leverage up 100:1 or so and get blown out the water?
The majority, they think money management looks after itself and it doesn’t.
Money management is the base on which your success is built and needs plenty of attention.
4. What Losing Period are You Expecting and Can You be Disciplined?
To win you are going to have to cope with losing periods and forget the rubbish you read online, that these periods don’t last long or you can trade with 90% accuracy - its fantasy.
Even the best systems will lose for weeks on end and you have to have the discipline to keep going, through the losing period until you hit a home run.
Most traders simple cannot do this, throw in the towel early and if they would have hung on they would have been rewarded with profits.
Understand this - if you want to win at forex trading you need to lose to win.
If you cant take execute a trading system with discipline, you don’t have one!
A Road Map to Success
Most traders lose at forex trading because they think its easy or are to lazy to do the basics and the fact is, forex trading is not easy as most traders lose.
Of course for the trader prepared to put effort in to their forex trading strategy, the rewards can be huge or even life changing.
You need a simple system, you can have confidence in and trade with money management and discipline and this is the cornerstone of your success.
f you understand the above you could soon be making big profits in the worlds most exciting and lucrative business opportunity. Work smart, keep it simple and adopt the mindset to win and currency trading success can be yours.