A Forex Trading Plan: Limit Your Greed and Make More Money
I don&8217;t know how long you have been trading forex, but you can be among those traders who have been trying to make a living or at least a supplementary income through forex trading, but have not been successful so far.
There are a lot of people who have spent several years to learn forex.
They have tried so many systems and strategies but they still lose.
They still think that they have not found a good system and their problem is that they don&8217;t have a good trading strategy, but they are wrong.
They have had several good systems but they have not been able to make those systems work and make money for them.
They know much more than what they should know to be a profitable trader, but they still read and learn more and more and still they think that they have not learned enough.
GREED is the most important reason of their failure.
They have not been able to become a profitable forex trader because they are greedy.
Because they are not even aware of their greed.
It controls them and pushes them to overtrade and take wrong positions, but they don&8217;t know.
Greed is a normal emotion that everybody has.
If you have not been greedy so far and if you think you are not greedy, just trade forex and see how greedy you are.
This is normal.
Everybody likes to work less and make more.
Everybody likes to become a multi-millionaire or multi-billionaire within the shortest time but the problem is this strong desire can not only prevent you from getting rich, but it doesn&8217;t even let you become a profitable forex trader who is able to make a steady small income every month.
The problem is that sometimes we don&8217;t know what greed is, what it does and how it works.
- take positions when there is no strong and sharp signal
- take the position while it is too late and you should wait for another trade setup
- push yourself to trade every day and when you don&8217;t find a trade setup one day you feel angry, guilty and uncomfortabletry to double or triple your account within the shortest time
- get furious when you see you have missed a good trade setup
- take too much risk and trade more than 2-4% of your account
- don&8217;t close a wrong position as soon as you are realized that it was a mistake
- follow several trading systems and strategies because you want to have as many trade setups as possible every day
- still look for e-books and articles every day and you read them and follow and try their directions and you are not happy with what you have learned
- like to trade with small time frames to have more trade setups
- set a big pip or monetary goal for yourself and you get upset when you can not achieve it&8230;
THEN you are not able to control your greed.
I don&8217;t say you are greedy.
I say you are not able to control your greed.
Because everybody is greedy.
The difference is some people are able to control their greed and some people are not.
Now let me share something with you today.
Then I will tell you what to do to become able to control your greed and become a profitable forex trader.
Please read the below paragraphs to see what made me talk about greed:
Last Friday the daily candlesticks had formed a very strong sell signal with several currency pairs including NZD-USD which had the best trade setup, but unfortunately market was opened on Sunday afternoon with a big gap, almost in all of the currency pairs that had already formed a trade setup.
Usually when market opens with a gap, it is used to go against the gap direction and fill it because those traders who already had a position from the last week, when they see they are in a big profit because of the gap, they get overwhelmed and close their positions to collect their profit and so price goes to the other direction right after the market open.
But last night it didn&8217;t fill the gap and kept on going down.
In these cases, I just call it bad luck and then forget about it and wait for another trade setup.
I never enter if I am late.
If I can enter on time and with the price that I should enter, I do it, otherwise I ignore the trade.
This is a very important aspect of discipline that a trader should have.
Our greed pushes us to enter even when it is too late.
I know it is a pain to see a good and a strong trade setup runs away from you while you are not on board, but this is part of the game too.
We can not catch all the movements.
I read somewhere that a trader said he preferred to be late than wrong.
But I think being late can be as risky as being wrong.
So I prefer to be right and on time than wrong or late.
Maybe many of you, have been trying forex for several months or even a few or few years but have not been profitable so far.
You make some profit every now and then and lose it with some bad trades.
Let me share a million dollar secret now.
It is the right time to do it.
You will become profitable only when you become able to control your greed.
You should be able to ignore some positions and signals that don&8217;t look good and strong or you are late and it is not safe to enter.
If you review your memory, you will see that most of the bad positions you have taken are because you have not picked a strong signal or because you had missed a strong signal but you pushed yourself to enter and make some profit and get out.
But they went against you right after you entered.
Maybe they have been waiting for you to enter to change their direction.
Sometimes it really looks like that a position has been waiting for you to enter and right when you clicked on buy or sell button, it changed its direction.
It is because you are late or you have picked a poor signal.
Being late or picking a poor signal is because of nothing but greed.
You can not ignore the money that it might make for you.
So you take it.
When it comes to trading, everybody becomes greedy.
Please don&8217;t get me wrong.
I am not criticizing you.
This is normal.
Everybody likes to work less and make more.
I knew myself as someone who could be everything but greedy.
But when I started trading, I discovered my greed.
It showed up.
It is hard to know it first.
You have no idea.
It pushes and controls you but you don&8217;t feel it.
You are not aware of its presence.
You will become a profitable trader only when you know it and become able to control it.
What is the solution?
The other problem with greed is that it covers your eyes and doesn&8217;t let you see the bigger picture.
You think, to become rich, you should have a $100,000 account and double it every month and as you can not afford to have such an account, you try to double or triple your $5000 account every week to reach that level but you wipe out your account every month.
This is your greed that doesn&8217;t let you sit and calculate and see how much money you could make if you just would be patient and happy with a small amount of profit every month and what account size you would need to become rich in a short time.
If you start with $50,000 and make only 5% per month, after two years, you will have a $161,255.00 account and a monthly profit of $8,062.75 (of course if you don&8217;t withdraw any money for two years).
It is a $96,753 yearly income which is good.
Besides, you can still leave some of the monthly profit in your account to grow it even bigger.
Then you will have more monthly profit.
What I am trying to say is that a small but steady monthly profit can create a great income for you after a while.
But if you follow your greed, you will do nothing but losing your money.
This is possible only when you become a consistently profitable trader.