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With the changes in the perception of Forex trading from being a high speed, high risk gamble, to being a scientifically driven investment vehicle, supported by social media, there are likely to be many more Forex traders in the coming years. All of these will have dreams, big or small; some are destined to fail, many more will make a success of trading and if we were able to see inside the minds of each, we'd find clear reasons why some made it and others fell by the wayside. Jump in a car for the first time, set off thinking you know what to do because you’ve been a passenger so many times and you’re heading for a crash unless you’re lucky enough to be a natural driver. The analogy could well be applied to trading Forex where...
When traders lose money, they often attribute the problem to a lapse of discipline. Such a lack of consistency, however, is actually the result of many different problems--not the cause. Traders lose discipline with trading for the same reasons that dieters lose discipline with dieting or people getting in shape lose discipline with exercise. Quite simply, our moods, needs, and mind states of the moment tend to overwhelm our longer-range intentions. We pursue short-term pleasures (and avoid short-term discomfort) at the expense of longer-term rewards. Here are some common reasons why traders (and most other human beings!) fall short of being fully intentional: Environmental distractions and boredom cause a lack of focus - All of...
Throughout the years I've been trading and writing I've often written about mind set - having the right frame of mind for your trading so you become a winner. I've stated that it is our job to trade "futures," not "histories." The future is the next bar on your chart. You can't possibly know how it will develop, how fast prices will move, or where it will end up. Since none of us know where the very next tick will be, it's impossible to know where the tick after that will be, or the tick after that, etc. All we know at any one time is what we're seeing. Interestingly, what we're seeing may not be true. Trouble With Data If we are day trading, we are not sure that what we're seeing is a bad tick, especially if it is not too far...
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