Forex is one of the most profitable businesses. Also, it's the most risky business.
Many technical knowledge, information and experience needed to reach your goal.
Your goal is to be rich and make a good amount of money. Isn't it? Okay, now we have to answer the next question.
Can you get rich trading Forex?
The answer is yes!
But you have to focus on the process and forget about trying to strike it rich. Focus on the process and the profits will follow.
What about successful Forex traders and what makes them different from the others?
In the Forex world about 80% of Forex traders do not succeed, especially at their start.
Why this big percentage?
Successful Forex traders think differently from the rest. They aren’t concerned with needing a high win rate or trying to trade every day regardless of market conditions.
So Who Are the World's Best Forex Traders?
1-Stanley Druckenmiller:
Stanley Druckenmiller has long considered George Soros his mentor. In fact, the two worked together at the Quantum Fund for more than a decade.
He was even there during Soros’ famous Black Wednesday trade in which they “broke the Bank of England” when they shorted the British pound in 1992.
The duo reputedly made more than $1 billion in profits from the single trade.
Stanley Druckenmiller left the Quantum Fund to start his own fund, Duquesne Capital. Duquesne Capital Management is famous for posting an average annual return of 30 percent without a losing year.
2-Bill Lipschutz:
He’s known for turning $12,000 of inheritance money into $250,000 while still in college.
Shortly after turning $12,000 into $250,000, he made one bad investment decision that nearly cost him the entire account. He was back to square one.
Lipschutz joined Salomon Brothers in 1984 as part of the newly formed Foreign Exchange Department.
One year later he was making $300 million per year for the firm.
Six Actions you need to have, in order to follow the steps of the successful Forex traders:
1-Use Price Action
Every successful Forex trader I’ve met uses price action in some way, shape or form.
This doesn’t mean they’re using price action in the same way I use it, but they are using some form of price action as part of their trading strategy.
Whether a trader is using raw price action or simply using it to identify key levels in the market, price action plays a major role in any strategy.
That’s because it serves as a representation of the psychology within a market. It gives us some insight into the minds of other traders.
Having some idea of where buy and sell orders are located in the market is critical to becoming the best Forex trader you can be. It can strengthen any trading strategy by providing areas to watch for potential entries as well as profit targets.
2-Have a Defined Trading Edge
An edge is everything about the way you trade that can help put the odds in your favor.
It’s a combination of the time frame you trade, the price action strategies you use, the key levels you’ve identified, your risk to reward ratio, and other factors. It even includes your pre- and post-trading routine.
How do you handle losses? What do you do when you win? These are all things that make up your trading edge.
Although there are dozens of factors that make up your edge, you don’t have to master all of them at once. Nor do you have to master all of them to start putting the odds in your favor.
It’s better to master one set of factors and then slowly expand to others to further define your edge. Not only is this a natural progression, it’s the preferred way to learn.
3-Successful Forex Traders Don't Try Too Hard
This is different from studying hard. As a new trader to Forex, studying the market is highly recommended.
For instance, you can’t spend too much time learning the ins and outs of the various currency pairs, or how to draw key levels. The harder you try to learn those particular topics, the better.
However, trying to make a trading strategy work will only lead to destructive behavior, such as emotional trading. Similarly, trying too hard to find trading opportunities is a good way to lose money on sub-par setups.
4-Think in Terms of Risk
As we said before, Forex is the most risky business and 80% of traders failed to achieve any success.
You may think that’s an obvious statement, but a surprising number of traders don’t think about how much money is at risk before opening a trade.
This is because they’re using an arbitrary percentage to calculate risk, such as one or two percent of their trading account balance.
Think about your last trade for a moment. Did you define the exact dollar amount at risk before putting on the trade? Or were you more focused on the number of pips and the percentage of your account at risk?
The convenience of Forex position size calculators has made it so that we never have to consider the dollar amount being risked. This convenience has caused a huge oversight.
5- Successful Forex Traders Know When to Walk Away
All successful Forex traders know when to walk away and take a break. Those who are truly passionate about trading Forex know how hard it can be sometimes to walk away from the market. Still, it’s necessary in order to become a successful trader.
Walking away can be especially difficult following a trade. This is because our emotions are running high and often get the best of us. But that’s exactly what makes walking away at this time so beneficial.
After a profitable trade
After a win, we’re feeling good about ourselves and our trading strategy. It feels like things are finally starting to click.
After a losing trade
What do you do immediately following a loss?
I can’t speak for you, but I know what I used to do. I would immediately start going through all my charts looking for a new setup with the intent of recovering what I just lost.
Whatever you do, don’t do this. It’s just your ego drawing you into one of the most common and costly traps in the Forex market.
6-Never Give Up
This sounds obvious, but it amazing, how often I see perseverance and grit left off the list of reasons why a certain trader became successful.
You can’t fail if you don’t quit.
That brings us back to the first section of this post where I mentioned passion. You can’t expect to achieve Forex success if you give up, and you can’t expect to persevere if you don’t have a passion for trading.
You must have a burning desire to want to succeed as a trader. Not because you want more money, but because you love trading.
Of all the ways to make money in this world, trading is arguably the worst choice.
Conclusion:
This actions must work as your policy. Work policy is important in this complex business. According to your policy you can select the best strategies that help you to enforce the policy.