Filed under Forex Tips
I have received several emails from readers of my blog asking me whether trading forex for a living is achievable. Therefore I am going to answer this question here on this post so that anyone reading this blog will benefit from it as well.
If you have been following my blog, you will know that I have always been playing down talks about how easy forex trading is. There are a lot of sales letter telling you how easy forex trading can be and you can make money simply with a click of a button. If you are having this kind of mentality at the moment, you should refrain from trading and start to re-adjust your mindset. I have met people who are trading forex for a living and all of them actually make it with considerable amount of effort and time.
Although it is not easy to become a full time trader or even make extra income from trading, it is something that is achievable and worth putting effort for. Forex trading is a recession proof income and it is something that no one can take away from you once you have learned and know how to trade profitably. Therefore in this post, I will highlight to you several facts that you need to know about the journey to trade for a living.
1) Time: Unlike what is usually seen on advertisement, forex trading is not a get rich quick scheme and you will not be able to make thousands of money from a robot or software. If the robot or software is so capable, do you think that you can get it for just a couple of hundred dollars?
After talking to other traders in this field, I can roughly tell you the time required for you to be able to make money CONSISTENTLY from trading forex. The key here is not to simply make one or two winning trades; it is to be able to generate consistent income months after months from trading. I personally take about 9 months to a year and several people that I know takes about a year to 2 to achieve consistent income. Therefore you need to give yourself at least 3 to 6 months to learn, 3 to 6 months to practice on a demo account before you start to trade live with you money.
2) Focus: New traders tend to jump from one strategy to another without giving a particular strategy a chance to perform. In order to be able to find a strategy that you can use permanently, you should spend sometime to try out the strategy on a demo account and measure its accuracy and profit. The problem with most people is they give up on a strategy once they see it producing a losing trade and then quickly move on to find another so call ‘better’ strategy that is perfect.
To be frank, there is no strategy that can give you 100% winning trade. As a trader, you need to understand that losing is simply part of the game and it is something that you have to accept. Therefore it is very important for you to focus on a strategy by trying it out on various market conditions and across different currency pairs. This can give you a good understanding on how to execute it and what kind of returns you can expect from it.
3) Discipline: This is also a very important point you have to take note if you are serious about trading forex for a living. There is no use for you to put in a lot of effort in learning and testing out a strategy but never really adhere to it when you are trading. There are a lot of people who are eager to get into a trade and enter trade even when there is no setup that is needed in their strategy. This is why there are a lot of losers in this field as compared to winners.
Having the discipline to stick to your plan is extremely important as consistency is the key to trading success. As long as you stick to your tested trading strategy and exercise good money management, you will definitely be able to make consistent income from trading.
4) Money Management: As stated in point number 3, exercising good money management can make a difference in your trading success. Often you will hear people talk about money management but did not really understand what it is all about.
The main difference between a gambler and a trader lies in their money management. A gambler simply bet based on their emotion and does not really care if they are able to trade another day. A trader always take note of their account to make sure that they are able to continuing trading even if they lost a few trades consecutively. Read this post on money management for more information.
The above are 4 things you must take note if you are serious about trading forex for a living. I believe that anyone can make consistent profit from trading as long as they are willing to put in the required effort and time.