Wherever you are in your forex trading career, you’ll know by now that it’s practically impossible to experience win after win. Sometimes there will be losses and, when it feels like you’re on somewhat of a downward spiral, it can be a challenge to pull yourself out of the negative mindset that comes with it.
If you’re just getting to grips with how to trade forex, it’s best to be as armed with as much knowledge as possible before you take your account live. Alternatively, if you’re months or years into your journey and looking for some advice about how to get back on track after a series of losses, this post is also for you. Let’s look at 4 steps to help you recover from a losing streak.
Step away for as long as it takes
Of course, you’ll probably need to practise trading for longer than a few weeks if you’re to hit the goals you’ve set yourself, but this doesn’t mean you can’t take a time out – and indeed, this is encouraged if you feel as though you need it. If you’ve experienced several losses in a row, this is where the forex trading strategies you put in place at the start of your journey will really come into play.
Your strategies will allow you to recognise when consecutive losses are becoming a problem – and this is just one of the reasons it’s a great idea to keep a trading journal. You can monitor any losses and, where possible, spot patterns in the way your trades are playing out. Keep your strategies at the forefront of all decision making and trust yourself to know when it’s time to take a break.
Take emotions out of it
There’s no denying that with any form of trading comes the risk of emotions getting involved. This is money you’ve worked hard to earn, so, if you do find yourself experiencing loss after loss, it’s completely understandable that you’d become concerned and frustrated. However, to ensure any future successes, you’ll need to find a way to remove your emotions from the equation.
To help you do this, speak to other traders and gain insight into their experiences. Knowledge sharing is a great way to help you see your trades from another person’s perspective, but keep in mind that everyone’s situation is different – so try not to be overly influenced by the decisions other people would make if they were in your shoes. The likelihood is that your circumstances are very different.
Refocus your mind
With your emotions in check, it’s time to get back on track by refocusing your mind. It’s to be expected that your confidence will have taken a knock, so this is the perfect time to think back to the logical approach and mindset you adopted when you first started out on your journey – and make it your mission to get back to this place.
Wallowing in losses won’t help your future trades – but getting back to basics and putting the losing streak behind you will give you a much clearer mindset for future trading. Revisit your journals and refamiliarise yourself with your strategies to gain some much-needed clarity about what comes next for your journey.
Don’t lose sight of the big picture
The final step on your journey back to success is to remember why you got involved in forex trading in the first place – and one of the best ways to recover from a number of losses in a row is to keep your end goals in mind. Why are you doing this? What do you want from it?
By allowing yourself to follow the first 3 steps, you’ll be in a much better position to refocus on your personal goals. Remember, you can always go back to a demo account until you feel ready to trade live again. Once you decide you’re ready to go live and you experience a handful of consecutive wins, you’ll feel much more positive about the whole experience.
From finding your confidence again to learning how to make decisions that aren’t influenced by emotions, recovering from a bad run is no easy feat – but by following these 4 steps, you’ll put yourself in the best possible position for a successful future in forex.