Do you know why just 5% of traders succeed while the majority of the other 95% fail in the forex market? This is because many of these traders believe that forex trading is simple and that they can make rapid money. They are in the business for the money (which is fine), but they do not take the time to learn about the industry. Furthermore, they lack the mindset required for successful forex trading.
If you want to be successful in forex trading, you must first have a good forex education. A good forex training course will cover the following two topics:
1. A Profitable and Proven Forex Trading System
You do not have to be a genius to find a good forex trading system. What you can do is to search for forex reviews in websites or forums to find out more information about the product that you want to buy. In fact, you can get one for f.ree in forums and some other websites. If you learn forex trading correctly, you will see why simple systems are most robust and easier to follow.
In forex education, most experts will ask you to trade using technical analysis and use the news as a fundamental guide. Based on any simple forex strategy, you will be using support and resistance for sure and you will either look for a continuation of trend or a breakout from it. What you need to do is to confirm with a forex signal before entering a trade. If prices break above resistance or below support, learn to follow the breakout using the breakout strategies.
2. Exercise Caution When Using Risk and Leverage
High leverage is what makes forex trading so lucrative, but ononthe other hand, it also destroys newbies' accounts because they could not handle the high leverage since they are inexperienced. You will need to learn to take calculated risk whenever the trades are in your direction.
If you are using some forex indicators in your trading systems, then you should follow them strictly and only trade when there is a high probability on your side. Besides that, you will need a very good money management.
Do not ever try to risk too much as the forex market can stop you out easily. Try to have a 1:2 healthy risk to reward ratio, and risk only 1% to 5% of your trading account per trade, this ensures that you have enough capital to continue trading in case you loose.
In any other businesses, you need a plan and forex trading is no different, set a realistic target and work towards it. Take your time to learn forex and experience the market yourself. Be patience and follow the rules, and the market will reward you.
For one thing, if you have experience with stocks or derivatives, get used to the idea of not having a break. The forex market simply does not stop during the workday. So if you are used to punching out 4:00 pm when the final bell is rung, get ready to put in some overtime. The market is ongoing for 24 hours a day.
The other thing to be aware of is the fact that the foreign exchange market is much more news driven than any other market. If the Fed Chairman sneezes the wrong way, a currency can go up or down 100 pips.
But the one thing that I just love about the forex market is that its price movements are a lot more cyclical than other markets.
By this I mean, if you study price charts on currency pairs, you will begin to notice that there are price action patterns that can be used to predict future price movement. No other market seems to have such strong correlative patterns.
The wonderful thing too, is that since there are so many currency pairs to choose from, and the market is always open 24 hours a day, you are bound to find solid trades across the scope of the market irregardless of what time it is. This is perfect for those that have day jobs and don't have the ability to look at charts all day.
In order to apply these tenets -- to move theory into practice -- educators and facilitators must understand the key role that is played by the value system of each offender. The fact is, many offenders have heard the good versus bad rhetoric many times. They are well aware of right and wrong in the eyes of society. The evidence indicates that it's not that offenders don't understand the values. It shows instead that, for one reason or another, they see no value in the mainstream system or no place for themselves within it. Put in that light, the focus must shift from the external forces of society to an introspective analysis of the individual.
Value Added
In designing or implementing programs for change, it is helpful to borrow from business the concept of the value-added reseller (VAR). A repetitive drone of the virtues of right versus wrong will not change behaviors. They will be changed when a value is added to the concepts the system is trying to sell. In other words, each offender needs to decide for him or herself that the doors opened through appropriate behavior are worth the immediate cost (change).
This cost analysis begins with an honest look at the values that drive individual offender behavior. For example, an Orange offender might indicate that he or she values drugs. Given the task at hand, it may seem appropriate to respond to this with a consequence statement. That statement however, does not provide the offender a chance to delve into his or her values, joys, needs, and strengths. When invited (or prodded) to dig deeper, he or she will find that it's not the drugs that hold the value; rather it's the risk-taking, fun, and freedom that they provide (at least temporarily).
Once down to the basics that drive the behavior, we need to continue to build in introspection and analysis of those driving forces. We need to begin building connections between offender values, behaviors, and goals. Only when we include this value added component, will significant and lasting behavioral change begin to occur.
If you're not exactly sure if you are primarily a Blue, Gold, Green, or Orange personality type, then check out the free test at where you can learn more about human temperament. When you subscribe to the free blog, you'll also receive a number of tips and strategies for finding more success with the people in your life, both at home and in the workplace.
About the Author: Nathan Bryce is the inventor of the world's first patented personality system, the Insight Temperament System, which applies the research of Carl Jung, David Keirsey, Isabel Myers (and many others) into real-life settings. His educational company, the non-profit Insight Learning Foundation, teaches hundreds of thousands of people all around the world how to understand people better.