Jump to content

Welcome to the new Traders Laboratory! Please bear with us as we finish the migration over the next few days. If you find any issues, want to leave feedback, get in touch with us, or offer suggestions please post to the Support forum here.

  • Welcome Guests

    Welcome. You are currently viewing the forum as a guest which does not give you access to all the great features at Traders Laboratory such as interacting with members, access to all forums, downloading attachments, and eligibility to win free giveaways. Registration is fast, simple and absolutely free. Create a FREE Traders Laboratory account here.

dailypriceaction

Are You Trading Forex For The Wrong Reasons?

Recommended Posts

Too often I see traders getting wrapped up in how to make money trading Forex before they even know why they're trying to make money trading Forex. In this article I'm going to address one of the most overlooked keys to success as a Forex trader. I'll also share with you some insights into my own journey as a Forex trader including how I learned to control my emotions before taking a trade.

 

What if I told you that in order to be profitable you first have to know why you want to be profitable? It's not enough to say, "I want to be rich". There's more to it, and it all starts with a simple question...

 

Why are you trading Forex?

Is it to go on vacations with your family, become a prop trader, or maybe you want to teach others how to trade someday? Regardless of your reason, if you want to be a profitable Forex trader, you need to ask yourself this question and be honest with yourself when you answer.

 

Just as you need to answer certain whys to enter a trade, called price action confluence, you also need to answer one BIG why before you can become profitable - why am I trading?

 

The way you answer this question is important because it's going to help keep you focused and disciplined throughout your journey to profitability. The answer to this question is also what drives your emotional tendencies as a Forex trader.Therefore knowing and understanding the answer is critical to your success.

 

Before we get into answering the question and learning to control emotional tendencies, let's find out why the Forex market has such a strong effect on our emotions in the first place.

 

The Forex Market is an Open Playing Field

For most of us, the unlimited freedom and creative expression that Forex trading offers is all but unknown. We tend to grow up in societies with rules and boundaries. If you cross a boundary, someone is usually there to put you back on the “right” course. When you were a child, it was your parents. Now that you’re an adult, it might be your boss. The point is that your entire life has been guided by society in some way, shape or form.

 

Trading Forex has no limits or boundaries. Think about it. With the exception of abiding by regulatory rules, the Forex market is a “boundary-less” playing field. You open a position when you want, close a position when you want and hold a position for as long as you want. There’s no limit to how much money you can make, just as there’s no limit to how much money you can lose. All of this sounds great, and these are all reasons that lure most of us into the world of trading in the first place. But what happens when there’s no longer someone around to tell us “No”?

 

Most of us don’t like to create rules for ourselves, especially when it was the lack of rules that lured us to trade Forex in the first place. It’s rare to meet a trader who didn't suffer considerably before realizing that more structure was necessary. Sometimes this suffering goes on for months, sometimes years. But I’m here to tell you that it doesn't have to be this way.

 

This section was sourced from and dedicated to Trading in the Zone. If you haven't read this book yet, I highly recommend it.

 

So how do we begin to take control? It all starts with your intentions; your why.

 

Have You Updated Your Intentions?

Do you remember putting on your first trade in the Forex market? Even though it was on a demo account (I hope) you still had certain intentions. You had obviously heard about Forex and were intrigued enough to open a demo account. So your intention was to see how it all worked. To see if you really can make money at this Forex thing.

 

If that was your only intention when you opened the demo account, that's okay! That's what demo accounts are for. But the fact that you're here reading this tells me that you want more.

 

So the next question you should ask yourself is, what are my new intentions?

 

When you placed that first trade in your shiny new demo account you were just testing the waters, right? So your intention was to find out if you'd like to pursue Forex trading further. For some of us it may have been love at first site (myself included) but the fact is that we still knew nothing about trading at the time. The demo account was our risk-free way of testing the waters.

 

Fast forward to today...

 

You obviously liked it enough to pursue it further. So then I have to ask, why are you here? A logical answer might be, "because I want to learn more about trading Forex". And I applaud you for that. But why do you want to learn more?

 

Do you see what I'm doing here? If you keep asking yourself the question, "why do I..." enough times you'll eventually end up at the root of why you want something. The answer to that root question is the one you'll want to focus on.

 

So have your intentions changed, or are you still just testing the waters? You may think your intentions have changed because you've given thought to trading full time. Or maybe you've thought about those amazing vacations you could take as a profitable Forex trader. But have you defined what you want out of Forex?

 

It's critical to your success as a Forex trader that you mentally update your intentions by defining what you want. I've never met a profitable trader whose mental attitude was, "I'm still trying to decide what trading Forex has to offer". Every profitable Forex trader knows exactly what they want to get out of the market. And it's not just money. There's more to it!

 

So how can you start to mentally update your intentions?

 

It All Comes Down to Two Questions

I always like to keep things simple. So when I started to think about updating my intentions years ago, it began with two basic questions.

 

  • What am I passionate about?
  • What kind of lifestyle do I want?

 

Both of these questions are very personal, so I can't answer them for you. What I can do is tell you how I answered them.

 

What am I Passionate About?

I'm passionate about being self-sufficient. I don't want to rely on a boss for a paycheck, nor do I want to be told what to do every day. I've worked in an office environment before, and I just don't believe I'm supposed to live that way. I'm sure many of you can relate to at least one of those statements.

 

Most of all, I'm passionate about sharing my Forex experiences, both good and bad, with others who share the same passion. I want to leave a mark on this world, and what better way than through selfless giving?

 

Before we move on, let me be very clear about something. My statements about working in an office environment are strictly my own perspective. I worked in that environment for a long time and had a lot of fun while I was there. My parents, the two most influential people in my life worked in an office environment their entire lives. There's nothing wrong with it, it just isn't for me.

 

What Kind of Lifestyle Do I Want?

When I first asked myself this question years ago I really had no idea. I had never sat down to think about the lifestyle I wanted in detail and how trading Forex could help me achieve it.

 

I finally came up with one word that could define my image... "ability". I wanted the ability to travel the world and live life to the fullest. I wanted the ability to provide for my family - to give them everything they deserve and more.

 

In talking with others, I've found that many people never do this exercise because they're afraid of the "what if". What if I don't achieve it? What if I fail?

 

In most cases they don't even realize they're avoiding the exercise for this reason. That's the power of the subconscious mind at work - protecting us when it thinks we need protection.

 

If you're part of this group that has put off answering this question, trust me when I tell you that you're not alone. But you do need to act on it and decide for yourself what kind of lifestyle you want and how Forex trading is going to help you achieve it. The longer you wait, the longer it's going to take for you to be able to control your emotions and become profitable.

 

Bringing it All Together

So why does all of this matter? It matters because in order to set out on the journey of becoming a profitable Forex trader, you first have to know the destination. The best example I can give is using GPS in a car.

 

When you set out on a 1,000 mile road trip, it's best to know the destination address and enter it in your GPS. This way you get to your destination faster and without the stress of getting lost. Without knowing the exact address, you'll most likely make some wrong turns, deal with the stress of getting lost and it'll take you longer to get to your destination.

 

Trading Forex is no different. You have to know the destination address (your "why") in order to get to your destination (becoming profitable). But it's not good enough to just know it; you have to see it. Your why has to be so clear in your mind that you can reach out and touch it.

 

Sure, you can figure out your why along the way. But just like not knowing the destination address for your GPS, it's going to take you longer to get where you want to go and you'll experience more stress along the way.

 

In closing, your answer (and vision) to why you're trading Forex is what's going to guide you in the right direction. When your emotions start to get the best of you, all you have to do is think about your why and let it correct your course.

 

Before every trade setup you should be asking yourself, "is this trade setup good enough to get me where I want to go"? But in order to answer this question, you first have to know where you want to go...

 

If you ask yourself this one question before every trade, you'll be one giant step closer to becoming a profitable Forex trader.

 

Your Turn

 

Why are you trading Forex? What kind of lifestyle do you want and how can trading Forex help you achieve it?

 

Stay Diligent,

 

Justin Bennett

Daily Price Action

Edited by dailypriceaction
Added my website at the bottom for attribution

Share this post


Link to post
Share on other sites

Everyone including those who looses money enters in forex market with a reason to make money with their money but some of them blow their accounts and some go forward making good returns. However those who let go their initial losses also find another good chance to make money on their investments but this is the hard way which they learn making money from trading.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.


  • Similar Content

  • Topics

  • Posts

    • Date : 14th April 2021. Market Update – World stocks hit record high. Market News Today – Treasuries erased early gains, but bond markets across Asia remained supported, after investors shrugged off the hotter than expected US inflation number yesterday and focused on the successful 30-year bond auction. Global stock markets rose to a record high on Wednesday as bond yields eased after data showed US inflation was not rising wildly as the economy reopens. As Reuters reported, Johnson & Johnson’s shares slid 1.34% after US federal health agencies recommended pausing the rollout of its COVID-19 vaccine for at least a few days, after six women developed rare blood clots. Setbacks to vaccination rollouts have raised concerns about the global economic recovery. New Zealand’s RBNZ left policy settings unchanged and confirmed its commitment to an expansionary policy, which helped to underpin the rise in Australia and New Zealand bonds. A sharp sell off in one of China’s largest bad-debt managers attracted attention and rekindled concerns over credit markets. Bloomberg also reported that Tencent Holdings Ltd is holding off marketing a planned dollar bond deal. Central banks remain focused on providing stimulus and the hotter than expected US inflation number hasn’t re-booted reflation trades so far, as negative vaccine headlines added to the already concerning outlook for EU supply. In FX markets, the USD was steady to lower after yesterday’s decline in Treasury yields and USDJPY fell back to 108.96. AUD and NZD gained. Both EUR and GBP lifted against a largely weaker Dollar, with EURUSD currently at 1.1964 and Cable at 1.3777. USOIL meanwhile is trading at 60.73 per barrel. Bitcoin hit a record above 60.73perbarrel.[B]Bitcoin[/B]hitarecordabove[B]64,500, extending its 2021 rally as Coinbase shares are due to list in the United States. Gold held up well against the USD. Today – Data releases today are unlikely to change the overall outlook, but include Eurozone production data for February and inflation numbers out of Sweden. Comments from ECB’s Guindos will also be in focus. US calendar has March trade prices but earnings to headline with JPMorgan Chase & Co. and Goldman Sachs Group Inc GS.N among the companies reporting. Biggest (FX) Mover – (NZDUSD @ 07:30 GMT +0.61%) The NZDUSD spiked higher on the largely USD weakness and after the RBNZ statement. The asset broke its 1-week resistance and turned above R2 and the round 0.7100 level. Currently fast MAs and MACD lines are aligned higher but RSI and Stochastics have started turning lower, suggesting a potential pullback. ATR (H1) at 0.00119 and ATR (Daily) at 0.00566. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Andria Pichidi Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
    • covid illustrates 'the extraordinary madness of crowds' and that  young people are more skeered of covid than older people is a sign of effective psyops ... just sayin' https://www.naturalnews.com/2021-04-11-5-dumbest-things-americans-doing-more-susceptible-covid19-mutations.html
    • Date : 13th April 2021. Q1 Earnings Season – The Banks. This week the key Q1 Earnings season kicks off in earnest with many of the major US banks reporting. Q1 earnings are seen as key for setting the tone of company performances as the post-pandemic timeframe gains momentum as the vaccination rate continues to climb and states continue to open up. Overall the US equity markets closed at all-time highs again last week, with a strong close on Friday just shy of those inter-day highs. The USA500 closed at 4,123, the USA100 at 13,800 and the USA30 at 33,751. The Financial sector has been a major beneficiary of the “reflation” trade and the 1.9 trillion Stimulus Bill and the proposed1.9trillionStimulusBillandtheproposed2.25 trillion Infrastructure Bill, which are all likely to benefit the banking sector in particular. So far 20 of the S&P 500 companies have reported and on average they have beat expectations by 11%, which is over 1.5 times above their average over the last 3 years. Overall expectations for the S&P 500 is for Q1 Earnings to grow by a very significant 25%, which would be the best performing quarter since President Trump’s tax cut inspired Q1 2018. Additionally, what is more encouraging is that estimates have been rising as the Earnings Season arrives; normally they start to decline as the data starts to emerge. Back in late February/early March consensus was for 22% Q1 growth. This enthusiasm is tempered by the high valuations the S&P500 is running currently; forward earnings are currently projected at 22.3 times whereas in a normal economic cycle the historical average is 15 times earnings, hence the scepticsim over further growth from here. However, overall 2021 earnings growth remains very robust and is penciled in at 26.5% versus a -12.6% decline for 2020. Another key drag on future growth in 2021 is President Biden’s proposed increase in Corporation Tax to 28% from 21%; estimates suggest that this could reduce earnings by 7.4% for 2021. Earnings season kicks off significantly tomorrow, (April 14) with big banks leading the charge. Reports are due from JP Morgan Chase, Goldman Sachs, Wells Fargo and First Republic Bank. Later in the week there will be data from Bank of America, Citigroup, BlackRock, U.S. Bancorp, Truist Financial, Morgan Stanley, HDFC Bank, PNC Financial, Bank of New York Mellon, State Street, Citizens Financial, Ally Financial. Whatever the outcome, much is anticipated from the numbers and tomorrow (April 14) JP Morgan are first up at 12:00 GMT with expectations of an Earnings per share (EPS) of 3.10[/B] and revenues increasing 5% to 3.10[/B]andrevenuesincreasing530.10 billion, this is followed by Goldman Sachs at 12:25 GMT with consensus numbers of an EPS at 9.79 and revenues also up to 9.79[/B]andrevenuesalsoupto[B]11.71 billion and also before the bell tomorrow is Wells Fargo at 13:05 GMT with an expected EPS of 0.69 on revenues of 0.69[/B]onrevenuesof[B]17.41 billion. Last time JPM and Goldman Sachs both beat on both revenue and EPS numbers significantly whilst Wells Fargo missed, disappointing the markets. All three key banks remain technically Bullish trading north of their respective 20-day moving averages. On Monday (April 12) JPM closed at 153.07, a few dollars shy of the March 18 high at 153.07[/B],afewdollarsshyoftheMarch18highat[B]157.18, Goldman Sachs closed down 2% at 324, some 324[/B],some[B]23 below the March 18 high, whilst Wells Fargo closed at 39.98 off 1.93% for the day and 39.98[/B]off1.930.89 below the close on March 18. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Stuart Cowell Head Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
    • GBP/USD Continues Downtrend After Rejection at Level 1.3900 Key Resistance Levels: 1.4200, 1.4400, 1.4600 Key Support Levels: 1.3400, 1.3200, 1.3000 GBP/USD Price Long-term Trend: Bearish GBP/USD has been in a downward move after its rejection from level 1.4200. After the initial fall, the Pound is making a series of lower highs and lower lows. On March 5, a retraced candle body tested the 61.8% Fibonacci retracement level. The retracement implies that the pound will fall to level 1.618 Fibonacci extensions or level 1.3493. GBP/USD – Daily Chart Daily Chart Indicators Reading: The 21-day and 50-SMAs are sloping horizontally. The pair has fallen to level 44 of the Relative Strength Index period 14. This indicates that the Pound is in the downtrend zone and capable of falling on the downside. GBP/USD Medium-term Trend: Bearish On the 4-hour chart, the pair has resumed a downward move. On April 8 downtrend; a retraced candle body tested the 61.8% Fibonacci retracement level. The retracement indicates that the pair is likely to fall to level 1.618 Fibonacci extension or level 1.3641. GBP/USD – 4 Hour Chart 4-hour Chart Indicators Reading The GBP/USD pair is currently below the 80% range of the daily stochastic. It indicates that the pair is in a bearish momentum. The SMAs are sloping southward indicating the downtrend. General Outlook for GBP/USD The GBP/USD is in a downward ward move. The recent downtrend was a result of rejection from level 1.3900. According to the Fibonacci tool, the Pound will fall to level 1.3493.   Source: https://learn2.trade 
    • EURUSD Upside Run Recedes Under 1.1900 Level, Dollar Begins the Week on a Strong Note EURUSD Price Analysis – April 12 From early session tops around the 1.1904 mark, the EURUSD has receded to approach mid 1.1800 level during Monday morning trading. The dollar started the week on a stronger note as Fed’s bullish remarks lent some support to the greenback. Key Levels Resistance Levels: 1.2190, 1.2050, 1.1952 Support Levels: 1.1800, 1.1693, 1.1422 EURUSD Long term Trend: Ranging The EURUSD is attempting to lower its price below the MA 5 at 1.1875, but it is running into horizontal support at $1.1870, and on break may lead to a bearish decline to the 1.1800 marks. A bounce from this zone, on the other hand, could lead to a retest of the 1.1900 level. A bullish breakout above the resistance level of 1.1952 could signal a sudden return to the upside. The rise from the 1.0635 level is seen as the third step of the pattern from the 1.0339 (low) level in the wider sense. Following a sustained rally, cluster resistance at 1.2050 could be seen. As long as the 1.1422 resistance level, which has now turned support, holds, this will be the preferred scenario. EURUSD Short term Trend: Ranging For the day’s start, the EURUSD struggles to alter the intraday bias from neutral, but with minor support at 1.1870 intact, a further rise is likely. Above 1.1952 level, the recovery from 1.1740 to 1.1927 minor resistance may continue. Resistance is at its April peak of 1.1927, with 1.1952 and 1.1989 levels seen in March. There may be a strong break there, indicating that the correction from the 1.2243 level has been completed at the 1.1740 level. A break of 1.1870 near-term support, on the other hand, would shift the bias back to the downside, with the 38.2 percent retracement of 1.0635 to 1.2243 at 1.1693 levels.     Source: https://learn2.trade 
×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.