In the journey to becoming a professional forex trader there will be many mistakes made and lessons learned. But the biggest difference between the professional forex trader who is consistently making large profits on every trade and the novice trader who is losing on every trade is very simple. The difference is the trading plan, as trader you will see that all the professional traders are trading with a plan and the novice traders are trading with emotion.
In the beginning of your journey as a new trader emotions will be your biggest enemy this is because emotions will have you being greedy as a trader, thinking that you will make a million dollars in one night. It will have you jumping in every trade because you will think that this trade is the one.
Last but not least the biggest emotional battle that the novice trader has to face is F.O.M.O which is the Fear Of Missing Out. This is what causes most new trader to wipe out their account and to quit before ever getting started.
This is why a trading plan is so important as you grow in becoming a constant and profitable trader. The plan will allow you to take the emotion out of your trading and give you a set of rules to follow. This is even more important because it will allow you to develop the patience and discipline which is needed to be that trader who has trades that are having 2 to 1, 3 to 1 and sometimes even 4 to 1 reward to risk ratio.
The Plan will tell you when to enter a trade, where to set your stop loss and it will tell you when to take profit to get out. The Plan takes all the thinking out of it, which is where majority of novice trader fail they are thinking on the go. On the other hand, the professional trader knows everything he is going to do before they ever hit the buy and sell button.
When trading you have to look at it like you are a sniper and you have only one shot and you cannot miss. You have to make sure the winds right, you have to make sure your scope is focused and any other conditions that needs to be just right to make sure when it’s time to pull the trigger you will hit the target.
As a novice trader this is how you have to transition your mind to think as a forex trader, it’s not about how many trades you take, it’s about being patient and having the discipline to allow price action, charts and your plan to work together. You have to pick the best trade that will deliver the best risk to reward ratio.
The professional trader will allow his plan to develop. To pick one trade that will deliver profits of 100+ pips, where the novice trader will take 10 trades to make a 100+ pips. Once your able to create a plan that delivers consistency, this is where all your goals and reason for becoming a forex trader turns into a reality and the forex lifestyle opens up to you.
As a novice trader if you do not have experience in building a trading plan or what’s needed, then it’s beneficial to get a forex mentor who has a plan that brings consistent profits and allows them to help you devise that plan to your style of trading. No trader trades the same, but they can use the same blueprint.
At forexbrokr, we have the knowledge, skills, experience of consistently profitable forex traders. The rule of life is to follow and receive advice from those who have made it and gone through where you are trying to go.
This is a guest post written by up and coming forex trader, Thomas Hickman (@thickman2012). Be sure to share this post and give Thomas a mention on Twitter with your comment!