The only chance to start making a stable income on Forex is to accept the inevitability of failures, gain lots of patience, and be ready to always move on. The path to trading success can be divided into five main levels. Perhaps you will recognize yourself in one of them. The main thing is to remember that it will be better in the future. You should keep on moving because at the end of this path you will find success.
Everyone promises you quick and easy money. You look at the chart and see how the price moves up and down, in waves. When it goes down you sell. When it goes up you buy. Not too complicated, right? What could possibly go wrong?
You are not the first to come to Forex with such thoughts. And you will not be the first to randomly open trades and close them when the price goes the wrong way. Open orders in the opposite direction and close again when the market reverses. And so on in a vicious circle.
And losing from the start is not the worst option. Someone is lucky to open several successful trades and so begins to invest more and more, increasing the volume of transactions and, in the end, losing tons of money.
Usually, it takes a couple of weeks for traders to understand that Forex is not so simple. This is the moment when you begin to realize your incompetence.
This is a difficult stage. You are already aware of your incompetence but continue to make many unforgivable mistakes.
You understand that the time to become serious, start studying and use some handy tools. At this stage, traders tend to complicate everything and cling to every dubious opportunity:
- Constantly change trading styles and strategies
- Litter the charts with countless indicators
- Seek out for any kind of signal in the market
- Try every single Expert Advisor
Whatever you do, you will continue to lose more than you earn. This stage lasts an average of up to a year. This is where most traders leave the market. More than half of them will not last even three months. The main thing at this level is not to give up everything and wait for the next stage that will become a turning point for you.
This is the moment when you understand that there is no magic grail, that you cannot predict with 100% accuracy the next price movement. At this stage, the trader begins to realize that it’s crucial to start with yourself:
- Learn to cope with your emotions
- Get a reliable risk management system
- And most importantly, build a simple trading plan
This is the moment when other traders and their opinions stop existing for you and you are left face to face with the market finally starting to understand it. It’s like gaining Zen. You stop seeing money and only see numbers. You create an individual system that becomes unique. You start taking losses as part of the process. You understand that you are finally becoming a competent trader.
Your profit has finally begun to exceed total losses. You quickly find suitable trading signals, always look for confirmation, and open successful trades. You are not afraid of fluctuations in the market. You know how to protect your profits and close trades after receiving a signal for an exit.
You do have losses. You can lose 30 points right in the morning but in the evening you win them back. Bad days happen too but you don’t give up and get extra profit in the next few days. Your system works and you know it.
This is what you aspired to from the very beginning. Trading becomes an integral part of your life and firmly enters your daily routine. Checking the economic calendar every morning is now a habit. Closing trades in the evening and at the end of the week is more a routine than an important thing that you might forget about.
This is the moment when you start using intuition to open your orders. You only need a quick glance at the chart to see if there are any worthy trading opportunities. At this stage, Forex trading might become your full-time job because you get significant and, most importantly, stable profits from your trades.
Sorry to say but those who come to Forex for quick and easy profit are going to fail. You are also doomed to failure if you want to “defeat” the market and make it work for you. The success on Forex only accompanies those who are willing to work.
Only a few reach the fifth stage. Not more than 5-10%, to be exact. And it’s not about any special abilities. The path to success is long and difficult. Only those who are able to overcome difficulties, no matter what will reach the end. Are you one of them?