As a profession that requires you to work in conditions of uncertainty, forex trading can often result in traders feeling successful after a big win one day, yet equally as disappointed the next after an unexpected loss. As such, due to the at-times turbulent nature of this type of trading, it’s crucial that you build a strong psyche and harbour a positive mental attitude when it comes to forming a stable career in the world of foreign exchange.
So, to help rid you of trading anxiety, in today’s blog post we’re detailing 3 forex trading tips sure to build your confidence in the market – providing you with more time to focus on creating comprehensive forex strategies instead.
Focus on the process, not your investment
Whether you’ve recently started your career in forex and have just experienced your first big loss, or you consider yourself a forex veteran who’s begun to feel a little anxious lately, you’ll know by now that foreign exchange markets are unpredictable. While there are forex strategies you can implement to help foresee market changes, there’s no real way you can know for sure whether your trade is going to win or lose. So, the most important thing you need to remain aware of is the trading process itself – as opposed to focusing solely on your investment returns, which can leave you feeling worried and anxious as a result.
As such, be sure not to obsess over the outcome of your trades – instead, concentrate on ticking off all parts of your strategy when carrying out a trade, as each time you follow one of your own rules, that has been a success in itself! While you may not see results immediately, this is an effective way to exercise self-discipline and will make you feel more confident in your trading career as a result.
Practice again, again and again!
How did boxing legend Muhammad Ali manage to win 56 of his 61 fights? After all, he certainly didn’t know what moves his opponents would make, nor did he know their game plan to knock him out. Was he stronger, quicker or bigger than his opponents? Not necessarily. He won these fights and became known in boxing history through his years of training, discipline and confidence in his own ability.
As a trader, you too will not know how the markets are set to change and what punches lay around the corner. To be successful and build the confidence to tackle these scenarios, you need to prepare yourself for every eventuality – learning about and creating a forex strategy designed to tackle any situation. Only then will you feel confident in carrying out riskier trades, based on the knowledge you’ve gained from previous situations.
Success and confidence are usually intertwined – think about it, how many confident people do you know that have a consistently negative attitude and, when faced with a problem, feel bad for themselves instead of tackling the issue head on? Our guess is not that many.
It is inevitable that you will lose trades and how you deal with these losses will impact your ongoing strategy and potential for success. As such, in order to build your confidence you need to remain positive, thinking less about how much you’ve lost and more about the actions you took. For example, what went well and what have you learned from this trade for next time around? This will help you feel more confident when making future trades, as you’ll feel more prepared knowing what you’ve done right previously and what aspects of your strategy you need to work on.
If you want to know how to trade forex confidently, it’s vital that you remember that success and confidence go hand-in-hand. Believe in yourself, follow your trading and risk management strategy and you’re sure to find your number of wins start to outweigh your losses.
For further help regarding forex trading for beginners and professionals alike, why not find out more about how Learn to Trade can help you on your journey?