It’s been several months since our last article on trading psychology and it would be appropriate to share some insights into this area as well, especially if we consider that market volatility is still elevated and FX traders are constantly under pressure when managing trades. A week ago we’ve seen some of the USD prospects now that the Dems have taken control of both the White House and the Congress, so today it will be a shift towards an interesting topic that should be pleasant to read.
Trading is a Competition
When trading FX, you are engaging in an arena against banks, investment funds, and other financial institutions, far more prepared and with access to capital superior to what a retail trader can afford. This is how the industry operates and it would be critical to understand from the start that trading is a competition and in order to succeed, it won’t be easy.
Learning to read price action, risk management, executing trades flawlessly, managing your emotions while under pressure, are some of the most important skills a trader needs to develop.
Skills are developed under pressure
But most of the time, retail traders, despite being aware of these things, cut corners. They fail to get proper trading education, don’t make mistakes and instead rely on other people’s opinions on the market. By doing so, in case things will go wrong, they will have somebody to blame. It will never be their fault.
By having a subtle look at online forums for FX traders we’ll find many people complaining about the markets, how they’re victims of the system, and how if things change as they want, a pile of wealth will come at their door.
Hardships make you a better person
If trading would be that easy, everybody would be making money. That’s not the case and unfortunately, the majority of retail traders end up losing. You don’t have to be on the losing side if you understand that in trading as well as in life, hardships are helping you create a better version of yourself.
Embrace the challenge, develop the needed trading discipline, and stay on your course to becoming a successful trader by avoiding cutting corners and victimizing yourself for decisions that are in your hands. 2021 will be a very challenging year for traders all around the world and we hope this article could provide a boost of confidence and awareness for many of you. Good luck trading everyone!