Trading foreign currencies isn’t the easiest business to get involved in, especially for beginners or those with limited trading experience. Your most successful traders undoubtedly have several years combined experience in the Forex and other financial markets. Expert traders and those traders that make a living trading the Forex often advocate that beginners take a methodology similar to students beginning an advanced degree program at any one of the different types of professional schools (e.g. vocational, college or university, graduate school).
My time served in the arena of higher education has confirmed that moving ahead in such a program requires some level of commitment to reading, studying, and maybe even attending a study session related to the given field. To move to the top of that class, however, requires even greater discipline and more time committed to learning the course curriculum. I gained this “knowledge” strictly by not doing than by doing. I left the “doing” up to the “smart” kids in class; I won’t lie. At that time, the level of educational excellence at which those kids were working was higher than what I was willing to work for. And as you can image, the results at year end were justified. The smart kids were still smart kids, and I was, well, not. And I hated them for it. Funny how that works, huh?
Was I right to hate the “smarties”? Sure, why not! They got the good grades! They had the good hair! They studied hard and long. They gave up evenings and weekends of partying and fun for… the library. They actually read the homework assignments. I mean, what’s not to hate?. They probably attended Harvard or Princeton, and then went on to create a social networking site, which they sold to the highest bidder for billions, only to... let me stop my ranting.
Like school, learning to trade currencies is very similar in the type of commitment required to be successful. The best and the brightest of the Forex world have put in the time and effort, gaining invaluable skill, and becoming seasoned traders. Going into school, medical and law students know what’s required to succeed in the program, so limiting their social lives to better focus on developing their skills becomes a necessity. All efforts are centered on learning about their field, often at the sacrifice of hanging out with peers or living the “normal” life. The life balance is tipped dramatically in favor of work over play.
But is this balance the only way to become a successful Forex trader (or pediatrician, or nuclear engineer, or angio-radiologic technologist), one who is at the top of their game? Would you be mad at me if I said “Yes, it’s the ONLY way!”? One school of thought thinks so.. My thought is that it depends on the level of happiness in your life you want to retain during your educational journey.
Forex trading can be time consuming when you factor in the beginner’s learning curve, strategy creation, demo trading, learning to read, back testing, figuring out how to use your mouse and the list goes on. The more time you spend learning Forex, the more you are exposed to the workings of the Forex market. With time you start to build a good skill set for trading, and your experience grows with every trade. But with time spent learning and trading Forex, time is taken away from something else – your family, your friends, your other job, your toe nails, your dog, your lawn, your social life. My answer – to each his (or her) own. There’s no right or wrong answer here, folks.
Yes, you’re money is on the line (that’s if you’ve taken that big step to trading real money), but that doesn’t necessarily translate into ALL OUT FOREX OPEN 24/7! The most successful traders will tell you that trading isn’t only about that winning trade, but it’s also about what you learn along the way. There’s the mental challenge of trading. There’s the benefit of learning how others make money trading foreign currency. There’s the excitement of learning new investment strategies. It’s the process, man, the process!
You can be dedicated to learning and developing your skills as a trader, but a balance must be struck between your trading and the rest of your life. Stress outside of your trading has a way of finding its way back in. Stay happy. Get a life.
Give me your thoughts in the comments section if you have time. Are you an addict or wish you were (Forex addict, that is)?
Thursday
The Clock is Ticking.
Forex trading, even when done on a full-time basis, demands a lot of time and mental and physical energy. It's equivalent to a brand new job or the new "thing" you decide to spend your life doing. For some, it's your first time really exposed to this industry, let alone anything investing related. Sure, you've done the 401K thing at work, but that was multiple-choice. You do your best to read and learn everything you can get your hands on, when you have the time. Many beginners, however, underestimate just how much there is to learn about the markets, indicators, and economics in general. And get information overload from Day 1.
And lets be realistic - most of you aren't trading full-time. You've got a "day" job and more than likely a family to manage. Your trading consists of the few hours during the week and weekend when you can get away from your hectic life and focus on all things Forex. To help yourself, many of you start your trading day (or night) by formulating a To-Do or Action Items list.
You write out all the things you expect to get done by the end of the night, next week, and next month. You have some things that need immediate attention - those you'll tackle today. There are some things that need to get done now, but they're very time consuming - you'll try to fit those in today. Finally, you list the "wants - not needs" that aren't critical at this very moment, but are still important enough to eventually need completing.
You start on the first task, usually something quick and easy - sharpen a box of new pencils, install a new trading software platform, or peruse the beginner's forums. You complete the small task with lightning quickness and you move on to the next task that also needs immediate attention. Halfway through the next task, the phone rings.
"Hey, Mom. What a surprise!" Geez, we just talked last week. "Sure, I always have time."
45 minutes later you're off the phone and back to work. "Wow," you exclaim to yourself. "Where's the day going?" So, you get back on task and back to what you were doing. An hour or so later you've satisfied your immediate worries/tasks and you're on to one of the more important ones - like familiarizing yourself with Japanese Candlesticks at your most favorite and oh-so-funny Forex web site.
"Oh, this won't take too long. Candlesticks sound easy."
But do you ever get through an hour of learning candles? Nope, usually because the phone rings, or you feel the need to check your email, or the kids come a screaming about after school sports, or the boss calls needing a revision of the TPS report immediately, or dinner needs cooking, or something. The corporate world calls it "fire fighting," or "putting out fires." You've got your daily task list, but unforeseen "fires" erupt and need immediate attention. You're taken away from the current work load, breaking your focus and momentum. For others (myself included), not effectively managing all the items on our plate gets us into trouble. And this could be due to distraction (like the 18 hours of Law and Order televised daily, or the season premiere of American Idol), procrastination or just pure pressure to meet a deadline.
We need help!
Effective time management skills and having realistic expectations both play an important role in your trading development. A trading strategy has to be well planned, which usually mean hours spent reading journals, examining financial reports, and deciphering charts. And while the experience and knowledge you gain from doing each one of these tasks does play a role in the success of your trading plan, you'll soon realize that it gets tough spending too much time completing each one. With the recent discovery that a typical day only comprises of 24 hours, science tells you that you can only do what you have time to do, and your time is up! Your body is next to respond to your nonstop need for production by shutting down completely. Your body will only expend as much energy as you give it before needing a recharge. Unless, of course, you're a robot!
Expectation is important to keep under control because expectation can work for you or against you. Expectations set too high do a great job at creating pressure. When you're already burdened with too much to do and then pressured on top of that, anxiety kicks in and takes over your spin. You sit there biting your nails, thinking off all the things that need to get done.... yesterday, and nothing gets done! I know you really think you can back-test your latest trading strategy for the past 30 years and read the most recently released market reports from all world banks before lunch, but a lowering of your expectations is in order. Putting too much pressure on yourself to get something or many things done will only lead to more stress on your mind and body. Be realistic in your approach and expectation, and you'll see the difference in your productivity.
"Why don't you go do something productive with yourself," yelled my mother so lovingly, right before she chased be away from the television with her slipper.
How do you determine how much time to spend on formulating a trade or strategy? Honestly, there isn't one right answer. You've just got to be realistic about the time you have available to spend on the trade. Sure, reading ten trading books is beneficial to your learning, but reading them all at the same time doesn't work for most. You must realize your currently work load and prioritize those things that will be the most beneficial to your learning at that moment.
Which trading ideas or strategies do you follow? Many times you put together a great strategy that is highly successful but the prep time is mind-boggling. You have another strategy that doesn't return as well but is easier to execute. It's a balancing act where you have to decide whether dedicating large amounts of time to high ROI trades is worth it. The clock is definitely your enemy when you're just getting started in Forex. But getting more trades under your belt will be more beneficial to your experience in the long run.
There are only so many hours in the day for you to work with. That makes time a valuable commodity. Make a conscious effort when creating goals and timelines to be realistic about the amount of work needed to fulfill those goals and the amount of time you have to spend to complete those goals. Profitable trades don't only happen to perfectionist and those traders who spend every waking hour researching and testing. It is sometimes necessary to bring things into focus and down to eye level, out of the clouds. You can keep that big picture in your wallet, but remember not to place the bar too high that it can't be reached. Prioritize the tasks that will be most beneficial to your learning and keep things simple. In the end, success will only be another trade away.
And lets be realistic - most of you aren't trading full-time. You've got a "day" job and more than likely a family to manage. Your trading consists of the few hours during the week and weekend when you can get away from your hectic life and focus on all things Forex. To help yourself, many of you start your trading day (or night) by formulating a To-Do or Action Items list.
You write out all the things you expect to get done by the end of the night, next week, and next month. You have some things that need immediate attention - those you'll tackle today. There are some things that need to get done now, but they're very time consuming - you'll try to fit those in today. Finally, you list the "wants - not needs" that aren't critical at this very moment, but are still important enough to eventually need completing.
You start on the first task, usually something quick and easy - sharpen a box of new pencils, install a new trading software platform, or peruse the beginner's forums. You complete the small task with lightning quickness and you move on to the next task that also needs immediate attention. Halfway through the next task, the phone rings.
"Hey, Mom. What a surprise!" Geez, we just talked last week. "Sure, I always have time."
45 minutes later you're off the phone and back to work. "Wow," you exclaim to yourself. "Where's the day going?" So, you get back on task and back to what you were doing. An hour or so later you've satisfied your immediate worries/tasks and you're on to one of the more important ones - like familiarizing yourself with Japanese Candlesticks at your most favorite and oh-so-funny Forex web site.
"Oh, this won't take too long. Candlesticks sound easy."
But do you ever get through an hour of learning candles? Nope, usually because the phone rings, or you feel the need to check your email, or the kids come a screaming about after school sports, or the boss calls needing a revision of the TPS report immediately, or dinner needs cooking, or something. The corporate world calls it "fire fighting," or "putting out fires." You've got your daily task list, but unforeseen "fires" erupt and need immediate attention. You're taken away from the current work load, breaking your focus and momentum. For others (myself included), not effectively managing all the items on our plate gets us into trouble. And this could be due to distraction (like the 18 hours of Law and Order televised daily, or the season premiere of American Idol), procrastination or just pure pressure to meet a deadline.
We need help!
Effective time management skills and having realistic expectations both play an important role in your trading development. A trading strategy has to be well planned, which usually mean hours spent reading journals, examining financial reports, and deciphering charts. And while the experience and knowledge you gain from doing each one of these tasks does play a role in the success of your trading plan, you'll soon realize that it gets tough spending too much time completing each one. With the recent discovery that a typical day only comprises of 24 hours, science tells you that you can only do what you have time to do, and your time is up! Your body is next to respond to your nonstop need for production by shutting down completely. Your body will only expend as much energy as you give it before needing a recharge. Unless, of course, you're a robot!
Expectation is important to keep under control because expectation can work for you or against you. Expectations set too high do a great job at creating pressure. When you're already burdened with too much to do and then pressured on top of that, anxiety kicks in and takes over your spin. You sit there biting your nails, thinking off all the things that need to get done.... yesterday, and nothing gets done! I know you really think you can back-test your latest trading strategy for the past 30 years and read the most recently released market reports from all world banks before lunch, but a lowering of your expectations is in order. Putting too much pressure on yourself to get something or many things done will only lead to more stress on your mind and body. Be realistic in your approach and expectation, and you'll see the difference in your productivity.
"Why don't you go do something productive with yourself," yelled my mother so lovingly, right before she chased be away from the television with her slipper.
How do you determine how much time to spend on formulating a trade or strategy? Honestly, there isn't one right answer. You've just got to be realistic about the time you have available to spend on the trade. Sure, reading ten trading books is beneficial to your learning, but reading them all at the same time doesn't work for most. You must realize your currently work load and prioritize those things that will be the most beneficial to your learning at that moment.
Which trading ideas or strategies do you follow? Many times you put together a great strategy that is highly successful but the prep time is mind-boggling. You have another strategy that doesn't return as well but is easier to execute. It's a balancing act where you have to decide whether dedicating large amounts of time to high ROI trades is worth it. The clock is definitely your enemy when you're just getting started in Forex. But getting more trades under your belt will be more beneficial to your experience in the long run.
There are only so many hours in the day for you to work with. That makes time a valuable commodity. Make a conscious effort when creating goals and timelines to be realistic about the amount of work needed to fulfill those goals and the amount of time you have to spend to complete those goals. Profitable trades don't only happen to perfectionist and those traders who spend every waking hour researching and testing. It is sometimes necessary to bring things into focus and down to eye level, out of the clouds. You can keep that big picture in your wallet, but remember not to place the bar too high that it can't be reached. Prioritize the tasks that will be most beneficial to your learning and keep things simple. In the end, success will only be another trade away.
Positive Thinking Powers your Potential.
Being successful, whether it's as a Forex trader, a business owner, or even as a parent, takes a lot of personal development. Day after day you have to deal with many uncertainties, some known and many others unknown. You are continually tested by your surroundings (the currency market, your employees or coworkers, your children), and how you react before, during and after these challenges all play part in your success.
As currency traders we all have those days (or weeks) when things just don't go our way. Our losses are overshadowing our wins, and we can't seem to consistently win. We start to wonder if we can ever make any "real" money and if becoming a full-time trader will ever be realized.
"Why did I ever get into currency trading? It's nothing but a stress builder and a gigantic head ache. Who am I kidding? I think my hair is falling out!"
If you've been feeling this way and are asking yourself some of the same questions, it's time to sit down and work on your positive thinking. Any successful trader will tell you that he has made the mental decision to be as positive as possible in thinking, acting and doing, and that having a positive mind is critical in overcoming the setbacks brought on while trading.
So what can you do to become a better positive thinker?
Start off the morning by looking at yourself in the mirror and saying "I'm good enough, I'm smart enough, and gosh darn it, people LIKE me!" And say it just like Stuart Smiley from Saturday Night Live... with enthusiasm! No really, promoting yourself to YOU is a great first step in the right direction. It helps you get in the right mind set, and helps you to start your day thinking positive thoughts. If looking in a mirror scares you, I'm sorry...try just saying it out loud to yourself.
Next, observe your negative thoughts and understand that only you can change them. Once you start ridding yourself of those thoughts, you are thinking positively, while also creating a positive attitude. The market has its ups and downs. Your trading will have the same. Loses are inevitable. They happen to everyone.
Think and visualize yourself as already being a successful trader. Imagine that your trading experience allows you to easily notice changes in the market and react to them by making profitable trades. Imagine only positive results. Imagine the wealth you've created and the lifestyle it affords you. This type of thinking will help reinforce the ideas that first led you to the currency market and motivate you to stick with it.
Another easy method to assist you in becoming a positive thinker is to surround yourself with a positive environment. This can be your work space or the people around you. The world is filled with doubters and people who want to "help" you by destroying your dreams or shooting you out of the sky. Make it easier on YOU by surrounding yourself with other positive thinkers who reassure and support your Forex trading. And liven up your trading space so it's inviting and makes you want to be there. Maybe it's time to replace this crusty keyboard?
Also help yourself by being a positive talker to others and about youself. Speaking positively fills your head with positive thoughts and ideas. Negative self-talk only helps to hinder your potential as a trader and keeps you from growing.
Do your best to welcome the currency market's obstacles and view them as your opportunities for profits and success. Dealing with these obstacles will only help you to create a better trading experience. Small changes in the way you think about yourself, think about others and think about trading will go a long way in your overall success as a trader.
As currency traders we all have those days (or weeks) when things just don't go our way. Our losses are overshadowing our wins, and we can't seem to consistently win. We start to wonder if we can ever make any "real" money and if becoming a full-time trader will ever be realized.
"Why did I ever get into currency trading? It's nothing but a stress builder and a gigantic head ache. Who am I kidding? I think my hair is falling out!"
If you've been feeling this way and are asking yourself some of the same questions, it's time to sit down and work on your positive thinking. Any successful trader will tell you that he has made the mental decision to be as positive as possible in thinking, acting and doing, and that having a positive mind is critical in overcoming the setbacks brought on while trading.
So what can you do to become a better positive thinker?
Start off the morning by looking at yourself in the mirror and saying "I'm good enough, I'm smart enough, and gosh darn it, people LIKE me!" And say it just like Stuart Smiley from Saturday Night Live... with enthusiasm! No really, promoting yourself to YOU is a great first step in the right direction. It helps you get in the right mind set, and helps you to start your day thinking positive thoughts. If looking in a mirror scares you, I'm sorry...try just saying it out loud to yourself.
Next, observe your negative thoughts and understand that only you can change them. Once you start ridding yourself of those thoughts, you are thinking positively, while also creating a positive attitude. The market has its ups and downs. Your trading will have the same. Loses are inevitable. They happen to everyone.
Think and visualize yourself as already being a successful trader. Imagine that your trading experience allows you to easily notice changes in the market and react to them by making profitable trades. Imagine only positive results. Imagine the wealth you've created and the lifestyle it affords you. This type of thinking will help reinforce the ideas that first led you to the currency market and motivate you to stick with it.
Another easy method to assist you in becoming a positive thinker is to surround yourself with a positive environment. This can be your work space or the people around you. The world is filled with doubters and people who want to "help" you by destroying your dreams or shooting you out of the sky. Make it easier on YOU by surrounding yourself with other positive thinkers who reassure and support your Forex trading. And liven up your trading space so it's inviting and makes you want to be there. Maybe it's time to replace this crusty keyboard?
Also help yourself by being a positive talker to others and about youself. Speaking positively fills your head with positive thoughts and ideas. Negative self-talk only helps to hinder your potential as a trader and keeps you from growing.
Do your best to welcome the currency market's obstacles and view them as your opportunities for profits and success. Dealing with these obstacles will only help you to create a better trading experience. Small changes in the way you think about yourself, think about others and think about trading will go a long way in your overall success as a trader.
Who's feeling the stress?
Have you ever had one for those days? Your charting software didn't work just right, your Internet connection was doggedly slow, and you forgot to read up on this week's latest economic report releases (go and check out our Forex Economic Calendar, why don't cha!), so you missed all the good opportunities. And the kids or doggies running around the house didn't help either!
All of these events are just a select few sources of stress that the active trader has to deal with. Not dealing with these episodes correctly, and letting them build upon each other, can make you feel overwhelmed. When you're thinking with a stressed mind and body, your mind isn't focused, and this can mean danger for your trading. It's utterly important that your head is clear and you are cool and composed while trading.
Prolonged stress can be detrimental to not only your trading, but to your health in general. Knowing that stress can have such an adverse affect on you, it's a good idea to find ways to curb your stress all together, or at least reduce it, for the sake of a better trading environment.
In my previous article I mentioned taking a vacation. This is definitely a great way to bring the stress levels down, but it may not always be practical or feasible (for various reasons such as money, time, family, another job, oh, and did I mention money?).
But don't worry!
There are plenty of other things you can do right now (without having to spend the dough) that are as effective at reducing stress.
Exercise! This is a no-brainer. And don't think you have to run out and buy a gym membership. Taking a nice brisk walk around the neighborhood during your trading down-time will do the trick. Exercise helps relieve the tension that builds up during your crazy trading sessions and it keeps your body feeling loose and fresh.
Forget the obsessive purchases at Starbucks or drinking a 2-liter of soda, by yourself... in an hour, sitting in front your computer. Caffeine can be great at times, giving you that boost when you need to stay awake. But it can also make you super hyper and elevate your feelings of panic at just the wrong moment. Trading is stressful enough by itself. Don't let caffeine add to the mix!
Express yourself. No, not in that way. I mean through communication. The stress you feel during trading is many times caused by something not going your way. And more than likely, some other trader has gone through the same exact thing. Hop on a Forex forum to discuss what's bugging you, or what's not working for you. You'll find out that just talking about your trading stressors can be a big help to reducing their negative effects on you. And you might learn something, too!
Don't stress yourself by trading outside of your skill level. Set clears risk limit and have realistic goals. When you're just beginning to trade, you want to keep your positions small. Trading beyond your skills will definitely make you more anxious about your open trades, and will more than likely result in your account balance taking a hit, causing even more stress!
Stress will wear your down mentally and physically if gone unchecked or untreated. Take the time to identify some of the things you currently do that help reduce your stress, or follow some of my suggestions to get you on your way.
All of these events are just a select few sources of stress that the active trader has to deal with. Not dealing with these episodes correctly, and letting them build upon each other, can make you feel overwhelmed. When you're thinking with a stressed mind and body, your mind isn't focused, and this can mean danger for your trading. It's utterly important that your head is clear and you are cool and composed while trading.
Prolonged stress can be detrimental to not only your trading, but to your health in general. Knowing that stress can have such an adverse affect on you, it's a good idea to find ways to curb your stress all together, or at least reduce it, for the sake of a better trading environment.
In my previous article I mentioned taking a vacation. This is definitely a great way to bring the stress levels down, but it may not always be practical or feasible (for various reasons such as money, time, family, another job, oh, and did I mention money?).
But don't worry!
There are plenty of other things you can do right now (without having to spend the dough) that are as effective at reducing stress.
Exercise! This is a no-brainer. And don't think you have to run out and buy a gym membership. Taking a nice brisk walk around the neighborhood during your trading down-time will do the trick. Exercise helps relieve the tension that builds up during your crazy trading sessions and it keeps your body feeling loose and fresh.
Forget the obsessive purchases at Starbucks or drinking a 2-liter of soda, by yourself... in an hour, sitting in front your computer. Caffeine can be great at times, giving you that boost when you need to stay awake. But it can also make you super hyper and elevate your feelings of panic at just the wrong moment. Trading is stressful enough by itself. Don't let caffeine add to the mix!
Express yourself. No, not in that way. I mean through communication. The stress you feel during trading is many times caused by something not going your way. And more than likely, some other trader has gone through the same exact thing. Hop on a Forex forum to discuss what's bugging you, or what's not working for you. You'll find out that just talking about your trading stressors can be a big help to reducing their negative effects on you. And you might learn something, too!
Don't stress yourself by trading outside of your skill level. Set clears risk limit and have realistic goals. When you're just beginning to trade, you want to keep your positions small. Trading beyond your skills will definitely make you more anxious about your open trades, and will more than likely result in your account balance taking a hit, causing even more stress!
Stress will wear your down mentally and physically if gone unchecked or untreated. Take the time to identify some of the things you currently do that help reduce your stress, or follow some of my suggestions to get you on your way.
Concentrate or Lose Money.
You can be highly motivated to trade, have abundant capital, and a dummy-proof trading system, but if you don't apply your FULL concentration to the trade that you have on at the moment, you'll rarely make profits. It's imperative that you learn to concentrate while executing a trade and meticulously monitor the market while you're in the trade.
While in school did you have trouble studying in a noisy library or a crowded Starbucks? It's easy to concentrate when we are in a quiet room and when we are calm and at ease. But trading is often chaotic and full of stress. It's easy to become shaken and lose your ability to concentrate.
When you aren't fully focused on your ongoing experience, it's easy for self-doubts to creep into your consciousness. You may start having second thoughts and may want to sabotage your trading efforts.
The more you can stay focused on your ongoing experience, the more you can trade effortlessly and skillfully. But how can you concentrate more easily?
First, it's useful to remember that concentration takes psychological energy, and your supply of psychological energy has limits. If you want to maintain your focus, you must be rested and relaxed. Get proper sleep and nutrition. If you're tired or hungry, you won't be able to keep your mind focused on trading.
Second, it's important to control your stress levels. Stress depletes psychological energy. Even when you are excited rather than agitated by stress, your psychological energy is depleted a little bit each time you encounter an event that gets your adrenalin pumping. The best way to limit stress is through risk management. If you know that you are doing your best to keep potential losses to a minimum, you'll feel more comfortable and can focus most of your psychological attention on trading.
Concentration is essential for profitable trading. The more you concentrate, the more you feel you are in control. And when you feel your body and mind are in sync with the markets, you'll trade profitably.
While in school did you have trouble studying in a noisy library or a crowded Starbucks? It's easy to concentrate when we are in a quiet room and when we are calm and at ease. But trading is often chaotic and full of stress. It's easy to become shaken and lose your ability to concentrate.
When you aren't fully focused on your ongoing experience, it's easy for self-doubts to creep into your consciousness. You may start having second thoughts and may want to sabotage your trading efforts.
The more you can stay focused on your ongoing experience, the more you can trade effortlessly and skillfully. But how can you concentrate more easily?
First, it's useful to remember that concentration takes psychological energy, and your supply of psychological energy has limits. If you want to maintain your focus, you must be rested and relaxed. Get proper sleep and nutrition. If you're tired or hungry, you won't be able to keep your mind focused on trading.
Second, it's important to control your stress levels. Stress depletes psychological energy. Even when you are excited rather than agitated by stress, your psychological energy is depleted a little bit each time you encounter an event that gets your adrenalin pumping. The best way to limit stress is through risk management. If you know that you are doing your best to keep potential losses to a minimum, you'll feel more comfortable and can focus most of your psychological attention on trading.
Concentration is essential for profitable trading. The more you concentrate, the more you feel you are in control. And when you feel your body and mind are in sync with the markets, you'll trade profitably.
Concentrate.
You can be super motivated to trade, filled with deep optimism, have millions of trading capital available, and a solid trading strategy, but if you don't devote your full concentration to the trade that you have on at the moment, y
ou will lose money.
It's essential that you learn to concentrate while executing a trade and scrupulously monitor the market action during a trade
Why is concentration difficult? While in school did you have trouble studying in a noisy library? It's easy to concentrate when we are in a quiet room and when we are calm and at ease. But trading is often chaotic and full of stress. It's easy to become shaken and lose your ability to concentrate. When you aren't fully focused on your ongoing experience, it's easy for self-doubts to creep into your consciousness. You may start having second thoughts and may want to sabotage your trading efforts.
The more you can stay focused on your ongoing experience, the more you can trade effortlessly and skillfully. But how can you concentrate more easily?
First, it's useful to remember that concentration takes psychological energy, and your supply of psychological energy has limits. If you want to maintain your focus, you must be rested and relaxed. Get proper sleep and nutrition. If you're tried or hungry, you won't be able to keep your mind focused on trading.
Second, it's important to control your stress levels. Stress depletes psychological energy. Even when you are excited rather than agitated by stress, your psychological energy is depleted a little bit each time you encounter an event that gets your adrenalin pumping. The best way to limit stress is through risk management. If you know that you are doing your best to keep potential losses to a minimum, you'll feel more comfortable and can focus most of your psychological attention on trading.
Concentration is essential for profitable trading. The more you concentrate, the more you feel you are in control. And when you feel your body and mind are synchronized with the market, you'll trade profitably.
ou will lose money. It's essential that you learn to concentrate while executing a trade and scrupulously monitor the market action during a trade
Why is concentration difficult? While in school did you have trouble studying in a noisy library? It's easy to concentrate when we are in a quiet room and when we are calm and at ease. But trading is often chaotic and full of stress. It's easy to become shaken and lose your ability to concentrate. When you aren't fully focused on your ongoing experience, it's easy for self-doubts to creep into your consciousness. You may start having second thoughts and may want to sabotage your trading efforts.
The more you can stay focused on your ongoing experience, the more you can trade effortlessly and skillfully. But how can you concentrate more easily?
First, it's useful to remember that concentration takes psychological energy, and your supply of psychological energy has limits. If you want to maintain your focus, you must be rested and relaxed. Get proper sleep and nutrition. If you're tried or hungry, you won't be able to keep your mind focused on trading.
Second, it's important to control your stress levels. Stress depletes psychological energy. Even when you are excited rather than agitated by stress, your psychological energy is depleted a little bit each time you encounter an event that gets your adrenalin pumping. The best way to limit stress is through risk management. If you know that you are doing your best to keep potential losses to a minimum, you'll feel more comfortable and can focus most of your psychological attention on trading.
Concentration is essential for profitable trading. The more you concentrate, the more you feel you are in control. And when you feel your body and mind are synchronized with the market, you'll trade profitably.
Feeling Pressure? Take a Chill Pill. 0
You're like a deer in the headlight staring at your screens, frozen, and you don't know of what to do next.
You feel the pressure to perform. You haven't made a winning trade all week.
The bills are due and your checking account is running low. You don't know what you're going to do. You're becoming desperate and you swear to yourself "I'm going to push myself to make some pips."
Unfortunately, the more you tell youself this, the more stressed and more upset you become. Take a chill pill dude. Select a Nora Jones track on your iPod and kick back.
In these situations, it's natural to feel that you must push yourself to the limits to make a profit. Depending on your abilities and resources, be careful that you don't push yourself too hard. You might make matters worse.
Trading is a profession where you can convince yourself that your work is never done. There's always another chart to read, an economic report to digest, or a new trading strategy to create or test.
When it's been some time since you've made a winning trade, you start to feel that you absolutely positively must make a profit.
But unless you are a seasoned trading veteran, pushing yourself to the limits will only add to your frustration. Suddenly, you can't seem to get anything done. Applying additional stress on yourself doesn't always increase performance levels. Stress and performance work according to what scientists call an "inverted U curve".
Here's how the inverted U curve works in a nutshell. When a task is easy, like running around the block, a high level of stress enhances performance, but when a task is difficult and intellectually challenging, such as devising a profitable trading strategy, a high level of stress impedes performance.
Stress, even a small amount, saps up limited psychological energy. When you put stress on yourself to trade more profitably, you'll find that you start to feel a little tired. And if you push yourself too far, and go way beyond your abilities, you'll eventually exhaust all your stored psychological energy. And die. Okay, I'm just kidding.
When you feel stressed out because you are putting pressure on yourself, try reducing some of the pressure.
Tell yourself, "I'm not going to keep pushing myself. I'm just going to come up with a modest goal and work at it one minute at a time, and then maybe, one hour at time. I'll just give it my best effort."
See what happens when you try this thinking strategy. You'll find that you'll harness a little more energy just by simply taking some of the pressure off. Taking a break in the middle of a stressful day can also do wonders. Step outside, take a walk and soak up the sunshine. It will release some pent up stressful and negative energy.
You can also try a simple form of meditation. Go to a quiet place, and simply repeat this mantra, "I accept what I can get out of the market."
Repeat it over and over again. Concentrate on the words and let your worries about the markets disappear from your consciousness. You'll feel a little better, and you'll feel your energy level rise.
If you are a seasoned trader, pushing yourself to reach higher and higher standards of excellence can produce higher levels of performance. But if you are a novice trader, pushing yourself beyond your limits usually leads to frustration, stress, and eventual exhaustion.
When you have pushed yourself so far that you feel the pressure, STOP! Take a chill pill. Accept your limitations and relax. Ironically, you'll feel a little energy boost and will suddenly feel empowered. At that point, you'll be ready to tackle the foreign exchange market again, and grab those positive pips.
Brush up on your Forex Psychology.
You feel the pressure to perform. You haven't made a winning trade all week.
The bills are due and your checking account is running low. You don't know what you're going to do. You're becoming desperate and you swear to yourself "I'm going to push myself to make some pips."
Unfortunately, the more you tell youself this, the more stressed and more upset you become. Take a chill pill dude. Select a Nora Jones track on your iPod and kick back.
In these situations, it's natural to feel that you must push yourself to the limits to make a profit. Depending on your abilities and resources, be careful that you don't push yourself too hard. You might make matters worse.
Trading is a profession where you can convince yourself that your work is never done. There's always another chart to read, an economic report to digest, or a new trading strategy to create or test.
When it's been some time since you've made a winning trade, you start to feel that you absolutely positively must make a profit.
But unless you are a seasoned trading veteran, pushing yourself to the limits will only add to your frustration. Suddenly, you can't seem to get anything done. Applying additional stress on yourself doesn't always increase performance levels. Stress and performance work according to what scientists call an "inverted U curve".
Here's how the inverted U curve works in a nutshell. When a task is easy, like running around the block, a high level of stress enhances performance, but when a task is difficult and intellectually challenging, such as devising a profitable trading strategy, a high level of stress impedes performance.
Stress, even a small amount, saps up limited psychological energy. When you put stress on yourself to trade more profitably, you'll find that you start to feel a little tired. And if you push yourself too far, and go way beyond your abilities, you'll eventually exhaust all your stored psychological energy. And die. Okay, I'm just kidding.
When you feel stressed out because you are putting pressure on yourself, try reducing some of the pressure.
Tell yourself, "I'm not going to keep pushing myself. I'm just going to come up with a modest goal and work at it one minute at a time, and then maybe, one hour at time. I'll just give it my best effort."
See what happens when you try this thinking strategy. You'll find that you'll harness a little more energy just by simply taking some of the pressure off. Taking a break in the middle of a stressful day can also do wonders. Step outside, take a walk and soak up the sunshine. It will release some pent up stressful and negative energy.
You can also try a simple form of meditation. Go to a quiet place, and simply repeat this mantra, "I accept what I can get out of the market."
Repeat it over and over again. Concentrate on the words and let your worries about the markets disappear from your consciousness. You'll feel a little better, and you'll feel your energy level rise.
If you are a seasoned trader, pushing yourself to reach higher and higher standards of excellence can produce higher levels of performance. But if you are a novice trader, pushing yourself beyond your limits usually leads to frustration, stress, and eventual exhaustion.
When you have pushed yourself so far that you feel the pressure, STOP! Take a chill pill. Accept your limitations and relax. Ironically, you'll feel a little energy boost and will suddenly feel empowered. At that point, you'll be ready to tackle the foreign exchange market again, and grab those positive pips.
Brush up on your Forex Psychology.
Run Your Own Race.
Many years ago, horsemen invented blinders to keep their horses focused on their work. Blinders are pieces of leather attached to the horse's bridle that prevent them from seeing anything except what's in front of them.
Without blinders, a horse can see almost completely behind itself without turning it's head and can be easily spooked by movement or objects it doesn't recognize. By having fewer distractions the horse is more dependable and stays focused on getting the job done.
As a trader, I always discovered that whenever I started comparing my trading performance with other traders, my performance would usually worsen. This "distraction" cost me lots of money in terms of losses.
While I hardly watch television, I admire Oprah Winfrey so I watched an interview of her on the Biography channel one day. She and the interviewer were discussing her success and she made the comment that comparing herself to other folks in her business always made her take a step backward from her goal. Her words made me realize that even highly successful people experience this.
Don't compare yourself to others. It's tempting in the modern, competitive world to constantly ask, "How am I doing?"
It's easier said than done, but you should NOT allow how well you do compared to others affect how you feel about your inner worth and feelings of success in life.
Comparisons are useless. Run your own race.
Like the sport of golf, you alone are the one who needs to hone your trading skills. You are the one who must find a method that matches your skill level and personality. Comparisons to other traders just make you feel frustrated.
Don't constantly think you are trying to beat others to an imaginary finish line. People who achieve great things work independently and on their own terms.
They don't care how others are doing. They follow their own timeline, follow their own passion, and look INWARD for where to go next.
Notice how I said inward, and not outward. They look inward for where to go next.
How you perform has nothing to do with how others perform. All comparisons will do is torture you. You will feel jealously or envy.
When you see that you are doing relatively poorly compared to a fellow trader, you are likely to think distracting thoughts such as, "Why can't I do as well?" or "I must not be as good of a trader as I had thought."
To maintain motivation, focus on improving your past performance record, rather than looking at how other traders are doing.
You usually don't know what factors created their performance records, so comparisons can only mislead and hinder you. They could just be on a lucky streak or have a market wizard standing right behind them on every trade providing advice.
Put your "blinders" on. Don't look at anyone else's record but your own. Everyone has a different learning curve.
Without blinders, a horse can see almost completely behind itself without turning it's head and can be easily spooked by movement or objects it doesn't recognize. By having fewer distractions the horse is more dependable and stays focused on getting the job done.
As a trader, I always discovered that whenever I started comparing my trading performance with other traders, my performance would usually worsen. This "distraction" cost me lots of money in terms of losses.
While I hardly watch television, I admire Oprah Winfrey so I watched an interview of her on the Biography channel one day. She and the interviewer were discussing her success and she made the comment that comparing herself to other folks in her business always made her take a step backward from her goal. Her words made me realize that even highly successful people experience this.
Don't compare yourself to others. It's tempting in the modern, competitive world to constantly ask, "How am I doing?"
It's easier said than done, but you should NOT allow how well you do compared to others affect how you feel about your inner worth and feelings of success in life.
Comparisons are useless. Run your own race.
Like the sport of golf, you alone are the one who needs to hone your trading skills. You are the one who must find a method that matches your skill level and personality. Comparisons to other traders just make you feel frustrated.
Don't constantly think you are trying to beat others to an imaginary finish line. People who achieve great things work independently and on their own terms.
They don't care how others are doing. They follow their own timeline, follow their own passion, and look INWARD for where to go next.
Notice how I said inward, and not outward. They look inward for where to go next.
How you perform has nothing to do with how others perform. All comparisons will do is torture you. You will feel jealously or envy.
When you see that you are doing relatively poorly compared to a fellow trader, you are likely to think distracting thoughts such as, "Why can't I do as well?" or "I must not be as good of a trader as I had thought."
To maintain motivation, focus on improving your past performance record, rather than looking at how other traders are doing.
You usually don't know what factors created their performance records, so comparisons can only mislead and hinder you. They could just be on a lucky streak or have a market wizard standing right behind them on every trade providing advice.
Put your "blinders" on. Don't look at anyone else's record but your own. Everyone has a different learning curve.
Run your own race.
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