If you are wondering if forex trading is a scam then you are not alone. Sometimes in our trading journey, we are faced with bad trading decisions or sometimes good trading decisions that end up painting our trading history red. In this article we are going to look at why you suck at trading and how you can make consistent Profit from Forex trading.
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The Problem Many Traders Faced
Let’s look at Trader A; Maybe after spending many hours studying price action, supply and demand, smart money concepts, etc., and investing all his hard earned money into the market, Trader A is still struggling to make money from the forex market. Sure, they can be sometimes when Trader A wins, but his history will still end up in red. what could be the problem of trader A?
While you are still thinking of the answers, let me say that many traders are caught in this web of Trader A, instead of making consistent Profit from Forex trading which is the ultimate goal of every trader, they end up in the loophole of consistent loses. Imagine spending countless hours analyzing chart but just one trading decision and a change in the market direction can either make or ruin your entire day.
I have met great traders who are very good at price action analysis but sucks at trading; some of them will make huge profit from the market in one day, then lose all their profit and capital the next moment. So what are they missing?
How to Make Consistent Profit from Forex trading
Here is how to make consistent profit from Forex Trading:
Trading is a game of psychology and risk management
It doesn’t matter which strategy you choose, all that matter is your mindset; trading is 20% strategy and 80% psychology and risk management. I have seen many traders with good strategy failed because of poor psychology and risk management. If you want to make consistent profit from Forex trading learn how to control your mindset and understand the principles of risk management.
Let me specify a little on strategy, the reason your trendline strategy, supply and demand strategy and all other strategy may be failing is because of your trading psychology. For instance, there are times, when you buy an asset, but the market will play a little on your psychology, maybe after closing in red, the market will start going in the direction of your analysis. I have seen this on the trading history of most of my mentees (sometimes they close too early, other times they close too late).
If you can win the psychological battle with yourself, you can succeed in the forex market.
Trading is a game of probabilities
If you did elementary probability you will understand that probability means possibility; that is predicting how likely events are to happen. In forex, we use market history, market structure and everything in our disposal to predict the direction of price in the forex market. We believe that things don’t just happen in the market without any reason; for instance there are traders who believe that the market is control by the big banks so they have developed institutional order block, smart money concept, etc., to guide their entry and exit in the market.
They are others who just take advantage of trendline, support and resistance to predict the direction of the market. Whatever analysis method you use to predict price movement, you need to back-test it on a demo account over time, ensure you have consistent profit from your demo account before moving over to your real account.
To make consistent profit from forex, you must overcome FOMO
Fear of Missing Out (FOMO) is a great hindrance to trading consistency. Most time the market may seduce you with trading set up that will make you to hit the buy or sell button without looking at your rules of entry. This is where most traders get it wrong, if you are lucky the first time to come out with good profit, you may not be lucky the next time. Remember making consistent profit is the goal, not just one huge win, then consistent loses thereafter
Always look at your rule of entry and exit and ensure that everything is in line before placing any trade.
Trading is a Game of Patience and Discipline
If you want to succeed in forex you need patience and discipline. Patience to allow your trading setup to form and discipline to allow your trade to either reach your stop loss or take profit level. You won’t win all the time. So if your trade hit stop loss, try to know why, then analyze the market again
Patience is a virtue that all trader should possess. It is true there are countless opportunities in the market, because the market is always moving (except weekends for currency pairs), but you don’t have to take trades all the time. You need to keep your emotions in check and only enter the market when your setup is ready.
Trading forex is risky, so learn to manage your risk, control your emotion, be patient with yourself and the chart and you will make consistent profit from forex trading.