The One Thing I Wish I Knew as a Beginner Forex Trader
Recently I was asked what trading advice I would give, if I could go back and chat to my beginner-self to prevent me making the trading mistakes I’ve made over time.
The more I thought about it, the more I wondered whether I actually would prevent myself from making the mistakes I made.
The mistakes I’ve made in the past are precisely how I got to be the trader I am today. In fact, mistakes are critical to the evolution of a trader.
But there is one thing that I wish I had known in advance. I wish I had known that pain is part of the forex trading journey. But why?
Because there’s no such thing as an overnight success. Trading is a serious business. Every day you’re competing entering in to the arena with some of the fastest, sharpest, most intelligent, well-informed, stubbornly irrational and all-too-often unethical minds on earth.
We’re up against:
Computers that react faster than we can.
Traders with more experience than us.
Funds with more money than us.
Insiders with more information than us.
Company managers trying to misinform us.
The voice inside our heads that makes us second guess ourselves.
Once the bell rings and the trading day ends, is where the real growth as a trader begins. This is the time when you need to put the effort into self-discovery. And that begins by learning to take ownership of your mistakes in order to learn from them and eradicate them. Trading is a mental game. Think about it, all you have to do is repeat the same process time after time the actual trading side of it is as simple as it can get.
So why do so many traders struggle? The inability to maintain an unemotional state is the root cause of trading failure. Humans are hard wired to want to be right and instinctively struggle to accept are admit when they’re wrong. And guess what? In trading you will be wrong time and time again.
Accepting that being wrong is simply part of the game is a giant leap forward when it comes to conserving your emotional capital. Importantly, having the ability to completely cut a loss, accept it, and move on to the next trade is the next giant leap forward. These two key components alone are what can separate successful traders from those who fail.
So, if was to go back and tell my junior-trader self one lesson to help learn forex, that would be it. The market will do whatever it wants regardless of how much I want to be right. Being wrong is a part of the job… and it always will be. Accept this one concept, and you can grow into a successful trader.