Today's guest blogger is “Forex” Joe Atkins the Chief Strategist of OU Forex Trading. He blogged last week about preparing for 2010 and today he dives into what he, and most experts, consider the greatest trading tool of all: Your Mind!
I'm a student like everyone else here on the Trader's Blog. Some students are more advanced or experienced, while other students are not. I’m committed to helping emerging and developing students reach their full potential by providing an educational portal of substance focusing on trading methodology that works.
Besides becoming proficient with any trading methodology, one absolute remains: you must develop above average skills in another area to insure long term success.
I suggest using the ultimate tool in accomplishing the task: Your Mind
This article is written providing various exercises. I suggest you fully grasp and understand how the computer between your ears determines the amount of success one experiences.
The key to success in any area of life, include much of what you are about to read, is persistent focus in areas providing education for a lifestyle upgrade. Life is an every day learning experience. Success is a never ending quest for knowledge and applying those concepts.
My research has found, masses refuse to accept challenge needed to enhance success. Many stop short and near the cusp of greatness. As you read on, probe what is written with an open mind and develop perspective. I want to teach you how to be successful. Change your approach to life. My philosophies are different from most analysts.
To be successful, you must develop a mental tough mindset, have a total commitment, and understand the power of positive thinking. If you have a goal to be a winner, are willing to learn, pay attention, and take action, then you will accomplish your goals.
"Real heroes are men who fall and fail and are flawed, but win out in the end because they've stayed true to their ideals and beliefs and commitments."
- Actor Kevin Costner
If you choose to do nothing except follow a specific trading methodology seeking live positions as they happen in market, then you must be willing to put forth the effort to execute the positions consistently in practice regimen accounts.
That becomes your daily mission, to insure executing the tools provided on a consistent basis.
Once you create this new habit, after several months to a year, you will have curiosity overcome your fear.
During the process of overcoming fear, you will want more - that is human nature. The next step of growth is teaching how to fish for life; not just being spoon feed meals. Now you focus daily on updates of wisdom and guidance to insure your trading in the right direction.
If you are a beginner to the forex it is best to get some education to decide how much you want to participate. At the very least in my classes offered, I have subscribers execute recommendations provided from OU Forex Trader daily/weekend reports along with live positions as they happen in market with the Position Manger.
Folks, the daily updates are accessories to insure you are doing your part if you want to hang with the big game hunters. Developing skills is essential to attain success.
I always have live accounts ready to trade, but I use my practice regimen demo accounts on a daily basis to play in the sandbox. I usually place trades every day testing various theories or strategies in practice regimen demo account.
No matter how successful one becomes, using the practice regimen demo account is just as important as trading live to keep skills sharpen.
If you are a new trader, use a practice regimen demo account until you have success trading the currency pair you chose to stalk before going live.Those who are more experienced and use a live account, should always place trades in a practice regimen demo account for testing purposes.
The funny thing about practice regimen demo accounts is that they are free. I have these accounts and use various platforms to see what they offer.
I place trades every day using my skills and tools as a guide.
Do all the trades hit? No.
To become a better trader, we need experience. Where do we get experience? Through placing trades.
My live account grows staying the course. I protect my live account by using the practice regimen account for testing.
My practice regimen demo account allows me to test on a daily basis without any risk and once everything matches my trading plan. I attack for pips in the live account.
Those students with past experience in forex markets will move quicker than less experienced students. Counting on a 1 to 3 year journey towards gaining massive success, depends on your learning curve.
Without patience you will not last in Forex trading... Repetition is the mother of skill.
According to the interviews conducted by Jack Schwager in his book Market Wizards, he summarizes the 9 common denominators shared by the successful traders he interviewed, they are:
1. The desire to be successful.
2. The confidence that they could win over the long run.
3. Discipline to follow a given methodology.
4. Taking trading seriously.
5. Rigid risk control.
6. Patience to wait for opportunities.
7. Acting independent of the crowd. (Contrarian)
8. Accepting losing is part of the game.
9. Loving what they're doing.
Experience and persistence could also be added to the list.
Folks, forex trading plays tricks on your mind. The ebb and flow of the market is astounding. Few have the mental toughness to withstand the onslaught. Once schooled you only have to wait for signals that time has arrived for participation.
You don't become a winner by mistake. No team or individual can win every day.
The true professionals who are the most consistent winners are the type of people who commit themselves to perfecting their craft. They can find the time to do their homework, and are the types not afraid to spend long hours to make the necessary sacrifices to perfect their skills.
You must eliminate “Human Emotion” as much as possible in this business. It is paramount to success. Unless you are adapt at predicting the future, your mind is a far weaker ally than all the tools in your toolbox.
Using a Star Wars analogy: the Jedi were superior in mind control and were able to play tricks with weaker minds. Humans are emotional bunches who are not fully prepared for the forex market.
Really once you overcome fear, self-doubt, emotions, and attachment to money you, will be on your way to long term success. Depending on how much power those words have over you, will determine amount of time needed to develop needed skills for growth.
Remember you will learn how to control fear, self-doubt, emotions, and attachment to money as those are human emotions buried inside each of us since birth. Abundance is our birthright, yet many never reach full potential.
The market has no concern whatsoever for what your mind thinks; it will go where it wants to go, regardless of what you think. You must overcome and adapt to ever changing market conditions.
If you set your stop loss at whatever, then you must be prepared to follow through and accept a loss if it happens. If you have a loss, you must not let the loss damper your enthusiasm.
Review your trading plan to figure out what went wrong. Your procedure must become purely mechanical and consistent. Don’t waste quality time worrying about losses in practice regimen account, learn to accept and determine solutions on not making same mistakes over and over.
Don’t Hesitate or Don’t Procrastinate
To coin a phrase from President Jed Bartlet of West Wing fame… What’s next?
The name of the game in this business is patiently waiting for tops and bottoms of channels to form.
There are massive amount of pips to be subtracted from markets for those willing to wait for opportunities depending on your specific trading personality.
Marathon runners have only one thing on their mind when they are running. That is to cross the finish line. They never look back.
Same with trading. You should focus on surviving for the long haul. Sure, you will stumble and fall. However, you have to pick yourself up, dust yourself off, and carry on. Winners never quit, and quitters never win.
Repetition is the key to success in any endeavor in life, including trading the forex.
The more you practice trades and the more you execute trades in live market conditions, the better you get. You just have to keep at it - over, and over, and over again. Persistence is the key.
You're bound to get better at something if you do it constantly and don't quit. Don't let the market psyche you out. When you have a down day, just treat it as experience. Lessons learned. But, try to learn from your mistakes. Keep those journals going? If it's not written, it doesn't exist.
The forex is not about gambling. It is about running a business, where there will be gains and losses.
I have been told by wily ole’ traders, that if you don’t have losses in the forex market, then you are not taking enough risk. No one is 100% successful.
Repetition is the mother of skill.
The more repetitions one has, the better one's mental performance becomes through experience. It becomes easier and easier to make other changes in your life. With the stress gone - you start visualizing what you want - and because your feelings are mostly positive, you manifest at lightning speed compared to the old days.
One area that I found overlooked was developing the special mindset or personality to trade in forex market. The ebb and flow of currency swings demands a specific focus and patience that
Most are unable to fulfill, much less understand.
From a financial standpoint in regards to investing in yourself by increasing your knowledge, you have every reason to get off the couch, leave your comfort-zone and start making things happen for yourself via the forex market. Those willing will dramatically change their current lifestyle.
There are no shortcuts to experience. The more experience one has, the more successful you become. Time is on your side.
As Michael Jordan once said, "If you have a love for the game, your talent will eventually catch up to you."
My gift is sharing concepts on trading and mindset that becomes another tool in your arsenal. Someday you'll become satisfied with what you've accomplished. The forex market always has developments and frustrating days filled with disappointment. You can count on it my friends.
The key is how you handle adversity. What is your personality during adversity?
When you come up against difficult and challenging circumstances, just understand that you have greatness that you've just barely begun to realize.
Don't become so overwhelmed by the consequences of your mistakes that you fail to learn valuable lessons. Always remember that there are plenty of positive aspects to any living experience. Each trader will make mistakes. It's a fact.
Successful traders have a game plan.
Successful traders remain humble and respect the forex market, but all traders make mistakes.
Those who achieve incredibly great things experience plenty of setbacks and disappointments. They have simply decided to take renewed determination, instead of discouragement from those disappointments.
Just imagine how effective you could be right now in this moment, if you could free yourself from those burdens.
Will a positive attitude solve all your forex learning problems? No, but it will open your eyes to the valuable opportunities within even the most difficult situations faced on a daily basis.
Life is a journey. Many times, the computer between your ears, "your mindset," determines how you react to everyday rigors and stress of life. Please continue to stay humble and always, always give back to fellow students. We are a special breed who excel not just exist.
Please take time to research how blessed you have been to be introduced to forex markets. The possibilities are astounding as journey continues.
I have written enough for you to ponder. I have plenty more to share about setting goals in this market. I will return as you continue finding your sense of direction.
Till next time, May the PIPs be with you.