Category: Traders mindset

Define your Forex goals clearly to enhance results

Without a trading goal, it is very easy to get caught in endless losses. Define your Forex goals well and prepare your account for the rewards you are working towards.

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The whole idea of becoming a Forex trader is to make money. Extracting a piece of wealth from the market is our dream, but only those with the sharpest plans succeed. It is, therefore, very important to have long-term goals and visions of your life after a few years of Forex trading.

Think of trading Forex like standing on the edge of a swimming pool: you can see the other side, and you know where to swim to. If you have no goal when trading Forex, it is like swimming in an ocean, you have no direction and will probably end up swimming in circles. Just like opening a trade without a target, a goalless Forex existence can lead to doubt, confusion, and lack of a sense of purpose.

Take your time setting your Forex goals

Give yourself patience and don’t rush the process to try and decipher the market overnight. Develop an understanding of how you can extract money from the Forex market. Check off your trading goals after you have traded well, then create new Forex goals, and expand them to new, achievable heights.

An avoidable trap in Forex trading is scaling lot/position sizes up too quickly. Our main goal is to grow our capital, which means at some point, increasing the stakes. We need to earn the right to trade bigger. We should only reward ourselves with bigger trades when we have followed our plan and not broken any rules.

Bigger trades will come, and, if you are persistent enough, your Forex goals will be achieved, but take your time when rising through the ranks.

Use a vision board when trading Forex

A vision board is a collection of images for inspiration and visualisation of the life you want to achieve by participating in the Forex market. It is a nice way to get creative and prepare your mind for the tasks ahead.

Many beginning Forex traders will put lifestyle wishes and material items on this board. Think of foods, holiday destinations, cars, and anything that sparks joy and can be a reward for positive efforts and gains in the Forex market.

Some Forex goals should be within easy reach and some should scare you, but without them, it is very difficult to maintain direction without any destination.

A vision board can be created in many ways: a physical collection of images and words can be displayed near your workspace, or you could simply create two folders on your computer, a short-term and long-term collection of visions you want to obtain.

The clearer your goals, the better

Be very clear about what you want. Cover all the details and visualise the feeling of achieving your goals. Constantly connecting your thoughts with your Forex goals will help you to manifest them. Manifestation is all about attracting things to our lives, and hopefully one day you will experience the goal in your reality.

Some Forex traders who have seen lots of success have even said that they walk to their local car parks and pretend their dream car is there to fully feel the sensation of having it. Weight lifters visualise the lift in their brain before lifting to activate the belief that they can perform the act. As crazy as it might seem in the beginning, it all comes down to mental practice.

Having vision boards surround you every day can help to remove negative distractions that will hinder your thoughts and self-limiting beliefs. Combine positivity with a healthy lifestyle and taking breaks and you will be in the best frame of mind to win.

Some Forex traders will reinforce the vision board with daily affirmations to make their dreams act as a daily reminder. When our lives become busy with work, we won’t even think about sitting down to close our eyes and dream about goals. Exercising daily affirmations in combination with the visual representations on the vision board will keep your dreams alive. 

Forex goals conclusion

You should spend a lot of time at the beginning of your career building a process that allows you to trade with the long-term vision in mind. There is never a goal too lofty; there will always be ways Forex traders can make a fortune.

Always remember to understand where you are at, and trade safely according to your account size at any given moment. Risk low, and earn the right to trade bigger, focusing on the process and building consistency without feeling rushed. Finally, create visuals that will remind you every day of the long-term goals and exactly how you want your dream life to look.

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Trade little and often to make time to rest your mind.

High frequency trading means to trade wisely, not often.

The idea that high frequency trading requires staring at ten screens for ten hours per day is very wrong. Not only is this unhealthy when it comes to making trading sustainable for your mind, it will also yield poor trading results.

If you trade small sums often, you will find yourself being more productive and building a profitable performance. Trading wisely and making the correct decisions does not take a huge amount of time. When trading, you cannot control the market, but you can effectively control your own account.

Take time away from the charts

It can be difficult to progress after a winning trade. When you win, it is instinctual to immediately try to replicate your success. On the flip side, when we lose, we try to chase that lost capital as quickly as possible.

Win or lose, always shut off your computer after a trade and take time to reflect. This a crucial time in which you can build on your trading stamina and become a powerful and logical trader. Resting the mind will only help your knowledge and skills grow.

Not every session will be profitable, so always take time to work on your mind. If you feel stressed out, return to the charts later. Revise and optimise your Forex trading strategies in your time away from the market.

Develop a high frequency trading routine

As previously mentioned, most traders should consider reducing their time in front of screens. In the beginning of your trading journey, you may want to study and back test a lot. Creating a three to four hour daily routine is more than enough time to prepare your trades and keep a handle on your trading account with maximum growth.

When to close profits and losses

The simple answer to closing positions is, ultimately, when your bias changes. In most cases, you want to leave your trades to run, but there will be times when it is best to close out trades early, both when they are making profits and losses. You need to read and focus on the daily candlesticks to identify shifts, and then capitalise where you can. You must follow your risk management rules strictly in order to maximize profits.

Reacting to trading outcomes

When our Forex trading plans fail us, it is normal to experience disappointment and sadness as an initial reaction. Yet, when we start doubting our abilities to succeed in trading, when we start blaming ourselves for factors we cannot control, it is essential to recognise that emotions are playing too big a role in our trading.

Reducing risk and accepting that we will lose at least 20 to 50% of our trades is a part of the mindset of a trader, combined with the positive risks of a reward. A trader must focus on the bigger picture and not get caught up in the details of one bad trade. With a lower trading volume, a possible loss has a larger, more stressful impact, a statistic that works in favour of high frequency traders.

Trust the process and build an emotional structure that can withstand both winning trades and losing trades.

Simple yet difficult

High frequency trading is a simple process on paper, we either buy or sell. Placing a trade and hitting profit can also sometimes be easy. At the same time, enduring losing streaks can lead to depression. This can also lead to the so-called ‘anchoring bias,’ the tendency to define future trades by historical trends.

Some Forex traders tend to ignore the fact that the market conditions continuously shift and spend their time regretting past losing trades. The simple solution to this conundrum is to cover each trade with a low-risk stop loss.

 

High frequency trading overview

In conclusion, Forex trading is much more than financial knowledge or pure luck. Forex trading is a super complex field, with emotional intellect being a major player. Forex trading and Forex psychology are two parts of the game. Emotional awareness and control in high frequency trading is widely underestimated and should be seriously considered by all Forex traders.

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LEARN TO RELAX YOUR MIND

Keep Your Trading in Perspective – Look beyond your short-term goals and see the bigger, more successful picture!

In Forex trading, the bigger picture rules all decisions. When it comes to technical ability and applying the best trading strategies and risk management, trading psychology is most important!

It is not always easy to consider the bigger picture in dire trading moments, especially when pressure is involved. To achieve a sucessful trading mindset, rigorous mental work is required to stay disciplined and make the correct trading decisions.

Are you working on sharpening your big picture thinking strategy while trading? Let us delve into strategies to implement to become a big picture trader and trade successfully.

Be clear about what you expect from your portfolio- The clearer your goals, the smoother and more successful your trades will be.

Every Monday, build a plan – how do you see your week going? What risk limits are you working with? Be upfront with the amount of time you will spend behind the computer analysing, and be strict with your time! This will earn you more money in the long run.

Write your plan down and select two to three hours per day to dedicate to your trading in total, with the number of trades you allow yourself, the total risk that fits your plan, and only trade the opportunities that make sense within your specifications.

Once you have built a plan and understand your limitations to earn reasonable outcomes, you can start to work in a way in which you can see the big picture. With a big picture view, you can focus on the details of trading in a more structured way. The only leadership you have as a trader is yourself, so make sure you do enough prep work and do not jump in blindly.

Learn to relax – No matter how hectic trading can get, remember less is more and it is all in the preparation.

Like in any field, taking time away from a stressful environment to relax whichever way best suits you. Give your mind time to heal and rejuvenate after expanding with new experiences and knowledge. REST IS GROWTH.

Too many traders believe that “going harder generates more profit,” but this is not how you become the best trader and best version of yourself. The power that comes with taking a day off can vastly improve your ability to build on your long-term goals.

Another important aspect of your trading journey to focus on is embracing failure. You will find when learning to be a winning trader, that failure is something to embrace. Reimagining your current outlook on failure as a positive rather than a negative is extremely important.

Failing at something indicates many things. First, you tried and tested a method. Second, you have learned something new and can adapt your style to succeed in the future. Only through attempting and learning can you become a better and more profitable trader.

The bigger picture of a traders mindset

Now that you have the trading plan for detail trading vs the plan for the big picture, start flexing your big picture thinking muscles. In doing so, you are likely to improve your odds of success. And we have the data to back this claim – successful traders tend to think more broadly with long-term goals than the average traders by a solid 30-48%.

Forex Traders UK is passionate about educating traders about winning trading strategies. In addition to articles about trading mindsets, we also write about technical strategies. Subscribe to our newsletter to be informed about our newest blog posts.

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