Many years ago, when I began my trading adventure as a full-time trader, I watched a video that claimed that most traders lose 90% of their trading capital within 90 days of their trading experience. This really got me thinking because I was a victim of this rule. So I started searching for strategies that would help me become one of the top 10% of winning forex traders.
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In one of those moments, I realized that no one trades forex with the intention of losing money. Neither did any one join forex trading with the intention of not making money. This goes to day that just like in every profession where success and failures are, the same is true for forex trading. Thus, money making is the driving force for many traders. This discovery made me happy because I finally found the fact that drives many to lose – the focus on money and not the process.
This discovery made me happy because I finally found the fact that drives many to lose – the focus on money and not the process.
Having discovered that money is a by-product of value. Or should I say is a by-product of correct analysis and timely entry and exit, I decided to study and discover the skills and traits that makes the top 10% of winning forex traders successful
This article therefore addresses attributes of the profitable top 10% of winning forex traders, It is based on my experience and research.
Table of Contents
5 Strategies to Become One of the Top 10% of Winning Forex Traders
1. They Study and Understand Forex Charts
As far as I know, there is no profitable trader in the world who does not dedicate an ample quantity of time to the charts. I don’t care what YouTubers teach, but I am honest enough to tell you that if you want to grow your worth and succeed like the top 10% of winning forex traders, you must learn to invest a good amount of time in studying and analyzing your charts. Years ago, I decided that I would spend a minimum of five hours daily studying and analyzing charts in addition to my time with students and other traders. This has helped me grow and develop myself.
There is no form of consistency or upgrade without a dedicated focus on a task. Therefore, if developing your forex skills is a goal, please learn to be dedicated to the charts. This way, you will know what works and what does not. Many years ago, I asked a friend of mine who trades proficiently about his trading story. He said it is not about the strategy as much as it is about the commitment it will demand from you. This further adds to the fact that for every success story you hear or see, there is an ample amount of time dedicated to it.
Dedication to the chart is the foundation of self-development. It is also the place where discoveries are made. It is also a fountain of skills. Thus, to go further, make time for your charts and make the assumption that the forex market is always there.
2. Adherence to a personal trading guideline
Sticking to personal discoveries is one of the most important skills that profitable and long-standing traders rarely talk about or even teach. Some years ago, I engaged my mentor in a conversation about my growth pace. I felt I was slow and needed to up my game. Well, while he paid attention to me and ensured that I gave up all my worries and fears in the conversation, he looked at me with a smile and said, Avoid the competition and focus on what works for you. In his words, do not allow people to tell you that your success rate is too fast or too slow. Just run at your own pace. If your growth rate is fast, then stick to it. If it is slow, then stick to it. However, make sure that you do not stay in the same spot.
In addition, focusing on what works for me was a problem because I did not know what strategy to focus on. I seemed to know so much that focusing on a niche was a very difficult task. While explaining this to him, he gave me the following clues that heightened my skills:
He asked me the following questions:
- Which of your strategies makes you happy to play with even if it does not yield a result?
- which of your strategies makes you feel at home and smile anytime you use it?
- When you think of trading, what is the first strategy that comes to mind because it is easy for you to understand? .
These clues gave me the answer. Immediately, I told him it was price action. He went further to ask, Which price action tool works for you? I mentioned them, and then he said, That is your niche. Stay there and develop a life from it. Since then, I have grown into a technical master of my strategy
From this meeting with my mentor, I discovered that in sharpening your trading skills, the emphasis should be on a personal trading guideline and not a popular opinion. A trading guideline is the personal discovery of a trader. It works for him. This may go against what people teach on YouTube and other learning platforms, but sticking to personal discoveries makes a great difference in trading. In the forex market, what works is very objective. It is not what people say, think, or teach, but what gives results. Trading the forex market for more than four years has taught me to find my bearing in life. This does not mean that I cannot learn what works for others. Of course, I should. But the implication here is that I should learn to understand my own trading rules and stick to them because those discoveries are my trading secrets, which make me unique and different.
3. Equity is very Important
Many good traders do not grow their worth and make it to the top 10% of winning forex traders, because they trade with low equity. Thus, to grow big, one has to look beyond what he has to how far he can grow with what he has.
A good trading equity should be one of the targets to aim at. This helps to improve your trading leverage and gives you the opportunity to make better returns. Measures have been put in place to ensure that traders can grow their worth and equity. These includes the following:
i. Trading Prop firms
Prop firm trading is one of the measures that many individuals, brokers and institutions have used to attract profitable traders and pay them for their proficiency. Although this involves a series of processes such as registering with a prop firm company, buying the account and following their rules as agreed upon the terms and conditions, traders who sail through the different phases are always rewarded with accounts that a greater percentage of the monetary reward gets to them. often times, this option is used as one of the most popular means of raising money for trading. The disadvantage is that one must be really good with forex and its associated risks before he can succeed.
ii. Managing Portfolios
Managing portfolios is one of the measures used by traders to raise equity for themselves. This involves managing accounts for people or corporations or institutions or getting money from people or other sources to trade and remit a certain percentage to them per month. This is one of the ways top 10% of winning forex traders who are very good tend to use in raising money for themselves. The disadvantage is that one must be really good with forex and its associated risks before he can succeed.
iii. Rendering Trading Services
For many traders, rendering trading services such as teaching, mentoring, coaching, selling of courses, giving of trading signals are some of the services they offer for a fee. Money made from these avenues are used to increase a trader’s equity. Although this is a passive means of raising capital, the disadvantage is that one must be exceptionally good with teaching and the products offered for sale must be of a high quality and a high retention ability to keep viewers or subscribers and customers active regularly.
4. Avoid the Habit of Missing Trading Opportunities
The emphasis of the story is, avoiding the habit. If there is an attribute that makes a trader successful or unsuccessful, it is the attribute of missing trading opportunities. It is true that forex trading is a 24/7 activity. However, there are sessions where market volatilities tend to be high or low. In these sessions, a skillful trader knows how to leverage on market trends to make money. when the opportunity is lost, it is wise to exercise patience until the market presents another opportunity.
For every successful trader that I have studied, the ‘Fear of Missing Out’ (FOMO) is a unique attribute that have been capitalized on for profiting. While many traders see this as a bane for wrong trading decisions, successful traders know that there is a psychology behind missing a trading opportunity. The psychology there is that there is a 90% possibility of taking trades that you feel have trended for a long time. More especially, when the trend is from an asset that you have analyzed previously. Therefore, instead of missing opportunities consistently, they leverage on certain factors to gain an edge in the market. These factors include:
1. Trading with pending orders:
Pending orders are delayed forms of trade executions that a trader takes after analysis. It is different from an instant execution in that it allows traders to execute trades a presumed future price level. This is to ensure that opportunities are secured. Several types of pending orders are used in forex trading (depending on the trading platform used). However, the commonest include the buy stop, sell stop, buy limit and the sell limit. These are used skillfully to avoid missing trading opportunities.
2. Use of alarms and other forms of notifications:
Notifications help traders to be alert about an analyzed price level. They tend to turn on as price approaches a presumed zone or point where notifications have been set. Using alarms and custom indicators which produces alert is a guaranteed way to avoid missing trading opportunities especially where pending orders have been set. This serves as one of the hidden tricks of profitable traders.
Through the use of pending orders and alarms/other forms of notifications, profitable traders leverage on measures to ensure that the remain consistently profitable.
5. Leverage on Trends
A trend exits when price creates swing highs and lows either as an uptrend or a downtrend. When this happens, successful traders understand that it is the season of harvest and thus must be capitalized on. On swing highs, they leverage on buy opportunities using several strategies as convenient. Conversely, during the sell trend, they leverage on sell opportunities using several strategies as convenient. This, however, is not the story of many traders who often trade but do not leverage on trends for optimum profiting. Factors such as fear, ignorance, small equity, and negligence can contribute to reasons why traders leverage poorly on a trend. However, these attributes are negligible among top 10% of winning forex traders. Therefore, to develop this skill, and grow your worth, do the following:
1. Learn the secret behind multiple trading positions
In the words of one of my favourite teachers, Rob Booker, one of the most difficult things to teach a trader is how to add to a profitable position. This he means to say is that, while traders hold onto losing trades and would possibly add to it, many traders tend to close winning positions prematurely and do not know that it is the time to add to it.
Study any top 10% successful trader and you will observe that one of their skillful attributes is adding positions to already winning ones. This is because they understand that trends do not last forever. Hence, when a profitable trend is accessed, one should leverage on it.
2. Understand trading limits
Another attribute of the top 10% of winning forex traders is that they know when to trade in a trend and when not to trade in a trend. Knowing when to trade might involve trading on specific confluences after an analysis while knowing when to avoid the market might be during a high impact news.
Furthermore, trading limits might involve determining the number of trading positions and lot sizes per trade. In days where the market trend moves and profits are secured, exiting the market on time is a form of limit. Conversely, in days where trend pulls back or goes south, exiting the market with a minimal loss secure trading confidence and initial capital. These are the trading limits of the top 10% and this has been the secret behind their longevity in forex trading. In losses, they accept it and in profit, they celebrate. Such is life!!!
Final Thoughts on 5 Strategies to Become One of the Top 10% of Winning Forex Traders
To become a profitable trader, get the knowledge, have a working strategy, fund your account, test and master your strategy on a demo before trading on your real account. Kill fear and greed; always remember if you don’t trades you will not be profitable, and if you lose a trade, learn from it and move on.
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