Are you trading in your free time? Or do you trade full-time? Having success does not come easy and requires certain traits.
Here are the 5 key characteristics of a successful forex trader:
- Not going over the top: We start from what not to do as a trader, which is no less important: be careful. This consists of reducing the sizes of your positions when volatility is elevated, choosing the more predictable currencies to trade on and certainly taking the occasional break from trading. Deciding when not to trade is as crucial as deciding when to enter a position.
- Being patient: Patience has many aspects: it begins at the beginner level: learn how to trade before practicing on a demo account and before jumping into a trade. And you jump into a trade, let it run its course. Having success isn’t the number of winning trades but letting your winners run and cutting the losing ones. Holding yourself back also applies after having success: don’t increase your position sizes too quickly.
- Changing with the markets: Even the best trading system cannot work forever. Sorry. This clearly applies to technical analysis but also to fundamental analysis. Everything changes over time. The trading pattern may remain relevant, but perhaps it needs a small tweak. Being able to adapt to changes is key to having long-term success.
- Not losing sight of the big picture: “Make the trend your friend” goes the old saying, but what is the trend? That clear trend you are seeing on the 5-minute chart may be quite meaningless in the very immediate future if it goes against the trend that you see on the daily chart. The big picture of your multi-trade strategy should not be lost to the current position.
- Understanding where you need to improve: Even the best of the best, the most skilled who are able to adapt and, keep sight of the big picture, remain patient and cautious, have their soft spots. Can you fix the issues? Some of them, but not all of them. Yet recognizing them is already halfway to a solution or to a meaningful improvement.
What do you think? Can you point out your own strong and weak points?
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