Characteristics of a successful trader
To develop into a successful and profitable trader, there are so many things you have to do every day. Persistence is on top of the list of skills you have to embrace regardless of your level as a trader. To succeed in this business as a trader, you have to build a consistent personal routine; a routine is what keeps you going even when you don’t feel motivated.
There is a huge difference between being motivated and having a routine. The difference is that motivation lasts only a few days, but a good routine keeps you going for years unending. For example, if you see a forex trader driving a Bentley, you’ll immediately be motivated to trade so you can buy all the expensive cars in the world and live out your dreams.
That single occurrence can motivate you to work for a few days, but by the time it dies down, you might just see that the path to becoming a successful trader is more than it seems. What happens after this? You stop working and lose your motivation.
Having a routine is more sustainable than being motivated, even though motivation is great! Every successful trader must know when to accept defeat and hold the brakes. As you trade, there will be lots of challenges on the way.
When you have a losing trade, the best thing to do is learn from the mistakes made and move on. As you trade, you’ll have many opportunities to celebrate your wins but never forget that there’ll be sad days.
Do not be afraid of Profit
Research by one broker has shown that about 90% of traders opened a position in the right direction, but 70% of them were unprofitable. This is because many traders get scared when they see a large profit!
So instead of pushing through, they get scared of losing the profit they made already and close their positions. This leads to mismanagement of trade and unprofitable future trading.
As a successful trader, risk management is a very important thing. You need to have a solid trade plan and great risk management to become a professional in the trading business. Everything that involves money, needs risk management because there will be profit and losses in the long run. Risk management is often overlooked by new traders, but it is extremely important.
You have to consider your account size, and how much you can stand to lose before you jump right in to trade. Trading without any risk management rules can be considered gambling! Risk management protects you and increases your profitability in the long run, and that’s what matters.
Learning how to control your losses gives you a better chance of being a successful trader. Learn about all the risks involved with trading and how to manage them, then practice your trade and build stamina. Every trader needs a trading plan they stick to so they can succeed. But to create your trade plan, you must backtest regularly.
Backtesting is an important exercise that every trader must do. You have to backtest and continuously try out your strategy as you grow. This will help you gain the confidence you need in your strategy, so you can create your profitable trading plan. When done properly, backtesting can help you to improve and take advantage of your strategies.
This is the best way to find mistakes and all kinds of flaws in your trading plan. When you backtest regularly, you’ll gain the confidence you need to trade in the real world.
Every successful trader must start their day with a morning forecast and end it with a forecast in the evening. You have to forecast every day at least twice and at the beginning of every week. By forecasting, you can open and close different positions in currency pairs before the main trade. Forecasting helps successful traders to stay organized and ready for unplanned opportunities. When you forecast, you decrease your chance of missing a trade.
Another great reason why you have to forecast is; that it decreases the possibility of your emotions affecting your decision because you have already analyzed the market. Forecasting gives you insight into the market, so you can see what trade aligns with your trade plan.
To become a successful trader, you must have mastered your emotions. Emotions cannot be mastered overnight, it takes time and experience! Strategies can be learned by anyone in a few months, even a total beginner in the forex world. But strategies are not enough for long-term profitability if not every trader would enjoy them.
Emotions are the foundations of every trade, and only experience and time can teach you how to control your emotions. In Forex trading, patience is very important, but the problem is many traders lack it. You have to be patient enough to take trades according to your trade plan and close positions right on time.
This can lead to losses and blame passing. Never pass the blame to the market or your fellow traders, if you want to be successful. The right course of action would be to look for your mistakes when your trade goes in the opposite direction. There’s no time to waste thinking about how unlucky you were or how you did everything by the book, but the trade still failed.
To become a successful trader, forget about seeking justification; instead, look for mistakes and improve on your next trade so you can progress.
These are the most important things you have to respect in order to become profitable and successful in this business. Don’t forget that persistence and hard work will help you arrive at your destination as a successful trader. Keep learning and trading to build experience and resilience in the market. That’s how you’re going to become a profitable trader.