Up until recently we all were led to believe that only 5% of people make it in the Forex trading world. Since the new laws by the CFTC, brokers have had to come clean about the percentage of their clients that wins.

Most have a winning percentage of around 25% to 30% with some up to 50%. So the "only 5% make it" is a myth! Now I am not 100% convinced on the figures they released but they are better than previously thought. This led me to question why still 70%+ fail at this business.

There is a number of reasons why. Mostly it is a result of poor discipline, risking too much of your account on a trade, trading with money you cannot afford to lose, which brings a lot of un wanted emotions into it. Also making trading more complicated than what it needs to be, and system hoping, going from one system to another without sticking to one long enough to learn it properly and becoming profitable at it, all the above are discipline related.

What you need to do firstly is to think about this as a business and treat it as a business. You need to develop a trading plan, and learn from those who have made it in this business, You will be surprised, most successful traders will gladly tell you what they know, but it is up to you to listen learn and stick with it.

However many people simply don’t want to put the work into creating a functional trading plan because of the temptation to dive into the forex market headfirst and try their luck. The end result of this lazy trading attitude will always be failure, as forex trading success takes effort and time just as success in any other profession does.

As we say here in swanky markets, what job on earth is going to pay you 6 figures a year without spending time getting educated!!

Demo 2 Live

Not demo trading is a big mistake a lot of traders make, some just believe all the hype a broker will tell them (A broker is a wolf in sheep’s clothing), and open a real account, then in 2 weeks they have blown it. This is impatience, lack of discipline.

Most traders will demo trade for a week or two and then go live because they think they are going to outsmart the markets!! By not demo trading you also are not taking this serious, and are not willing to learn the systems. Forget that Forex is a get rich quick scheme; It is a Get rich Slow scheme if you have the patience.

Some Forex traders who start will open a live account and make some money very quickly, but they always have and always will lose it, why? Because they have not learned the patience and discipline needed to survive here.

We say you need to at least double your demo account first before you even think about going live, when you go live take the amount you were going to fund it with and only fund it with 15% of that figure, once you have doubled that then you can add to your account, There is a massive difference psychologically between demo and live, Live is real money!!

Making it difficult for yourself

Many traders use way too many indicators on their charts, there is an element to trading that traders believe the more indicators they have the better they will be!! This is a myth, all you will get is confusing signals, your brain will be fried from trying to take in too much information, the best indicator you have on your chart is already there “Price Action”, and price will tell you what you need to know, just spend time learning it.

Once you have learned price action, you need to learn how to plan a trade and to carry it out. However, having a pre-defined trading plan is not enough in and of itself to make you a consistently profitable forex trader. Forex trading success is largely dependent on thinking about and trading the markets in a simplistic manner.

So it goes to follow that employing a simplistic trading method like price action trading, would be the best choice for a forex strategy that helps you maintain simplicity in your trading. Once you commit to a simple trading method like price action, you will begin to realize that reading an indicator-free price chart provides you with just as many signals than any indicator-based method does and that they are actually much more accurate.

Beyond this is the fact that learning to understand and trade off simple price dynamics is actually an art and a skill that will help you to better understand all financial markets and global economic scenarios.

You are truly developing your own perspective on the market when you trade using forex price action, this is something that complicated lagging indicators and forex trading robots simply cannot and DO NOT provide.

Overtrading and Greed

Overtrading is another big problem; we say “When you’re Green Turn off the machine”. A lot of new traders Overtrade, they will have made some nice pips in the morning but give them back in the afternoon, this is also greed which you need to control.

Also in the Greed category is risking too much of your account. It is hard to manage greed but you need to if you are ever to make it. A lot of people who do not understand the markets think of trading as gambling, this could not be further from the truth (we will answer that in a future article).

However what I will say, if you do not learn the rules, learn how to control your emotions, learn how to control risk and greed then it is gambling!

Trading is an art and a skill that needs to be learned. It seems easy to read the markets and make lots of money; however without self-control you might as well give your money to charity.

Professional gamblers in Las Vegas have self-control and know when to walk away. The casino in Las Vegas will do nothing to stop the gambler giving all their money away, neither will the markets stop you, it is UP TO YOU to walk away, We have a rule, 2 losses in a day and we walk away until tomorrow.
 

Swanky Markets

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