Particularly true for those first starting out in the currency trading market, although equally as important for veteren traders too, is the need for traders to focus their efforts on process over profits. The view is that a disciplined trader has a higher likelihood of turning the odds in their favour due to them being able to rely on the bank of skills they have acquired over the years of creating, analysing and seeing-through a measured forex strategy – making them well-equipped to deal with a number of scenarios that come their way. Without a measured trading strategy, you could be in trouble of seeing your trades fail, so identifying the part of your strategy best suited to help you reach your target is vital to the potential profitability of your trades.
In this blog post, therefore, we’re discussing 3 of the top reasons you might be starting to see your trades fail – or, alternatively, why you haven’t had much luck in the market thus far in your trading career, providing you with actionable advice on the ways you can change your own luck.
Not creating a strategic plan
As with any business, and especially true for those self-employed individuals such as forex traders trading online, setting goals is vital. Most crucially, however, is setting goals that don’t urge you to rush and, instead, require you to take your time and choose your best setups. As a result of this, you’ll create well thought-out forex strategies that are ingrained into your memory before placing any trade, helping you to avoid potential risks and increase your chances of reward.
You can define a ‘good’ goal by questioning whether or not your goal is measurable, whether it will help improve yourself as a trader and gain higher profits, whether it’s meaningful and whether it’s specific enough to allow you to create actions to achieve it. By setting yourself a goal (or a number of goals), you’re able to create a strategy not only for how to get to the desired result, but a strategy that helps you to identify the pitfalls of attaining them and solutions for how to avoid said obstacles along the way.
Refusing to stick to your plan
Your plan shouldn’t be treated as you would a New Year’s resolution – worked on for the weeks preceding the big celebrations until you fail to remember what they were once the February blues hit! Creating a strong forex plan and sticking to it requires you to consciously think about it day in, day out to ensure you’re actively reminding yourself of your goals and how to achieve them before placing any trade.
In basic terms, this means not cheating your way out of achieving your goals by deferring from your strategy, even on a single trade. Due to the potential volatility that the forex market necessitates, temptation lies around every corner, tricking you into wanting to make ad hoc trades that don’t facilitate your strategy and therefore, ultimately, your goals. By doing so, you’re only doing yourself a disservice and are subsequently likely to find the same goals on your target list the following year.
Failing to track your progress
Arguably the biggest reason why you’re not meeting your goals or addressing your trading issues is that you’re not tracking them. In the beginning stages of creating your goals, you need to set targets and milestones, depicted by setting yourself measurements and metrics for what you see yourself achieving at each stage. Having this to hand during daily trading will allow you to keep your goals at the forefront of your mind and force you to track your progress regularly – helping you stay on track.
Ultimately, it’s important to remember that successful and potentially profitable currency trading is a marathon, not a sprint. Join us at one of our award-winning forex trading courses to find out more about how you can set goals and start achieving them today!