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I hope you had a terrific Thanksgiving.  I absolutely have an incredible lot to be thankful for, not the least of which is finding the Forex market and Fx365i this year.  My goal for this last month of the year is to really focus like it’s the new year.  Everyone is always highly motivated in January because we all want to get the new year off to a great start.  I’m thinking that our prior thoughts and actions bring us to where we are today, so if I expect to have a great start to 2015, I MUST focus intensely now.  Without a doubt, one of my biggest goals for 2015 is to become a great Forex trader.  As such, I absolutely must focus now in order to accomplish this goal.

So what does it take to become a great Forex trader?  This is a topic that anyone who has invested any significant time learning to trade will eventually ask themselves.  The answer will not be the same for everyone because everyone is going to have a different definition of what makes them a great trader.  One person might say you have to pull 35 pips a week to be a great trader.  Someone else may believe they need to pull 150 pips a week to be great.  Yet another person may believe a great trader is someone who is right on over 80% of their trades.

Although we all have our own definition of what makes a great trader, I think we can all agree that trading is a long term endeavor.  After all, does pulling a 100 pip trade make you a great trader?  Certainly not.  If you can’t continue to pull positive trades, what is that one trade going to do for you next week or next month?  Not much….

What about someone who has a ton of knowledge about the intricacies of different indicators?  Are they a great trader?  Not necessarily.  Now don’t get me wrong, someone who has developed a deep understanding of the platform they are using definitely has improved their chances of becoming a highly successful trader.  However, all the knowledge in the world doesn’t mean anything if you can’t execute in the moment.  I know traders who clearly have a deep understanding of the market, but can’t ever seem to pull the trigger to get into the great trades they see on the screen.  Others struggle to admit when they are wrong and end up unnecessarily taking huge negatives.  It takes more than just knowledge to become a great trader.

So what does it mean to me to be a great trader?  In my mind, being a great trader means being able to consistently execute a winning and highly profitable trading plan week after week, month after month, and year after year.  In order to be a great trader, you must be great at consistently:

  • Getting great entry
  • Having fantastic risk management
  • Taking profits at the right times (it’s not what you see, but what you bank)
  • Moving up the lot ladder to be able to successfully trade larger amounts of money

In order to accomplish those things, I need to consistently be:

  1. Technically Sound
    • In order to be technically sound, you must constantly be educating yourself on how the market works.
    • At the same time, you can’t try and incorporate too many different trading methodologies, or you will spin yourself.
    • Every pair moves differently.  It is my belief that you should find a pair you like and stick with it.  Unless the pair basically stops moving for an extended period of time, don’t even look at another pair.  If you haven’t mastered your first pair, why are you going to jump around and look at multiple pairs that you don’t thoroughly understand?
  2. Emotionally Intelligent
    • Do you have the patience and discipline to consistently NOT TRADE until the moment is just right and the trade just comes to you?  Most highly proficient traders I know have gone through a period of over-trading.  Every one of them has said that learning to take less trades is one of the biggest steps they took when they made the turn to become a consistently profitable trader.
    • When it finally is time to get into a trade, do you consistently have the guts to get into the trade with sharp, decisive entry?  Or do you wait too long and end up chasing the trade?
    • Do you have the smarts to consistently get out of trades when they give you new information and start to go against you?  Or do you get married to the trade and start moving your stop… and end up taking unnecessarily large losses?
    • Do you have the ability to consistently “plan your trade and trade your plan?”  Can you stick with it?  For example, on the Smart Money Profile platform, if you have a target liquidity line 30 pips from your entry and you are up 15 pips and the trade starts to breathe back, what do you do?  Is your plan to move your stop so you have no risk and then stay in the trade, or is your plan to get out as soon as it starts to take a breath?  There’s no right or wrong answer, but the real question is can you consistently stick with that plan in the heat of the moment?

 

You may have noticed one recurring theme in the points above:  Consistency.  I have a saying on my personal trading tracker:  CONSISTENCY x (PATIENCE + DISCIPLINE + RISK MANAGEMENT + GREAT ENTRY) = MILLIONAIRE.  I’m getting there.  I hope you are too!  I have had moments where I have done all of these things to a tee, and moments when everything has gone out the window.  Not surprisingly, when I over-trade, chase trades, or exhibit poor risk management, my trading results suffer.  However, as I’m learning to control myself more and more, I know I’m on my way to becoming a CONSISTENT and, I believe, GREAT TRADER!  After all, isn’t that what we all want for ourselves?

I hope your trading is going well.  If you ever want to talk about any of my posts, or anything about your own trading, please email me at pipaddict73@gmail.com.