When I first started trading Forex I began with trading on the usual broker demo accounts in order to learn all about the different tools & functions available, as well as to get a better understanding of what exactly I would be looking at every day. While I have 2 degrees in finance, knowing information is not the same as being able to apply that information. It takes practice in order to begin trading Forex with confidence.
If you’ve never worked in trading or are just starting out in the field, it is imperative to understand that this is not an overnight get rich quick scheme. It is a trade business that requires time and effort like any other to learn and grow. You need to make mistakes and most importantly, learn from those mistakes. This is why so much of trading has to deal with psychology. In order to not repeat mistakes, you need to train your mind so that you begin to understand why they occurred in the first place.
Much of trading is very much contrary to how everyday people think about things. Traders commonly make money off the fear they know others have. They understand what scares people and in turn how people react to those fears. When you know what the majority of people are going to do should a certain event strike, then you’re in a position to profit from their reactions. This is the essence of a good trading system, not reacting to the event, but to the reaction of the overall market.
Can You Predict the Future?
I once heard a speech where the speaker said, “If I can whistle a song, and you know the words and can sing along, I own you.” What he meant was that if he could simply make you think about something, he already knew you would know, then he already knew what you would be thinking before he even started whistling.
So, if the news is whistling about a hurricane approaching Florida, I already know how the majority of people are going to react, and in that knowledge, there is opportunity to profit off their fears. I know people are going to hit Walmart & Home Depot for the things they need to prepare their homes & businesses. Depending on the severity of the storm, I know how much they may need to spend to prepare. Likewise, depending on the amount of damage, I know how much goods and services will be needed to recover.
When you can begin to look at everyday circumstances of life as potential profit opportunities, you can begin trading Forex with confidence. But it takes time. You need to see events occur over and over until your confidence in how the markets respond. This applies significantly to how you use fundamental analysis in you trading system. If you can understand how economic reports correlate with one another, you’re better prepared for the market reactions when they occur.
For example, one of the biggest reports of the month is Non-Farms Payroll (NFP). This measure the average of the majority for U.S. payrolls reporting outside of farming across the country. NFP is probably one of the largest, if not the largest market moving report there is. the ability to predict what this number will be is a huge advantage for Forex traders because the potential for a large market move. Another major report is US unemployment numbers.
So, if we get a report of unemployment that shows a greater than consensus rise or fall in unemployment, obviously this is going to affect the number of payrolls reporting either negatively or positively. Along with other reporting factors readily available to traders, and with proper understanding of one another, you can begin trading with confidence knowing you have not only previously seen the reactions of markets off these reports, but you can also begin to test your beliefs based on firm confluences.
How Bad Do You Need to Breath?
When I started trading, I stayed up sometimes for days. I stayed up overnight, I stayed up during the day. It didn’t matter. What mattered is that I needed to see what the market was doing and going to do. I needed to see how the market reacts to changes when markets opened and closed, holidays, weekends. I wanted to know which months, if any, were better than others & why. I wanted to see how the Forex market reacted to Equities markets, futures markets, market fears, market rallies, news reports, economic reports. I wanted to know, and still do, what moved these bars on my chart, and why.
The point is that if you want to become a great trader, you need to put in the time & effort it takes to become a great trader. You may have heard somewhere the inspirational story of the young man who wanted to become wealthy, so he went to a guru who told him to meet him at the sea. When he arrived, the guru asked him, “How bad do you want to succeed?” “Go into the water.” “You want to be successful? Go further into the water.” When the water reached to his neck, the guru held him down under the water. Gasping for air, he pulled him up and the guru asked him again, “How bad do you want to succeed?” “When you want to succeed as bad as you want to breath, then you will be successful!” When all you want is to be successful, you do everything it takes. When you want it bad enough that you do everything it takes, everything, then you will be trading Forex with confidence.
How bad do you want to breath? How much do you want a change in your life? In your finances? In your relationships? In yourself?
Go Deeper! Trade Forex with Confidence!
Go deeper into the water and fight for air like you need to breath. Go deeper into what you want to know, what you want to do, what you want to have and fight harder than you’ve ever fought to have what you want.
The first level to success in anything is you seeing it and believing it is yours for the taking. Go hard! Get your dreams! Believe, Hope, Faith.
Mark 9:23, “Jesus said unto him, If thou canst believe, all things are possible to him that believeth.”
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