When it gets tough, remember why you started in the first place.
If you are living in the same world I am, most of the things that are really worth it turn out to be a fair amount more difficult than initially thought.
Trading FOREX for me has been one of those things. I got started because I thought about WHAT IT WOULD BE LIKE, to be able to earn money on my laptop, anywhere in the world I was connected to internet.
I thought to myself, ‘I would flip my screen open at a Starbucks in the northwest for an hour, gather up a few pips before heading out to the Mt.Hood Snowbowl for some fun ski runs.’ Or maybe I would grab up a couple hundred bucks while killing a few hours in the afternoon, visiting my dad in Colorado while we wait for friends to come over to dinner.
Nothing would be better than earning some money, while on a trip in some exotic location, sitting in my boardshorts, drinking cool water and waiting for the wind to die down at the surf spot.
This ladies and gentleman was the fuel. There is always fuel required to instigate action of any type. Something fueled you!
The games begin. We meet the markets with optimism and enthusiasm. Weeks go by, months go by. My performance didn’t match my expectation. No problem, just push the target date out a bit further of when the goal will be realized. More time passes. My skills improve some. I think I’ve got it. I bump up my lot size, after all, if I want to make any meaningful money I need to get into a bigger lot size.
I make some bad decisions, I get a slap on the wrist. Doubt sets in. The target no longer seems to be anywhere in the foreseeable future. I forget about what this opportunity can really provide. I start to focus on the fact that its ‘just another way to make money,’ ohhh bother.
SUDDENLY I snap out of it. NO, not this time. I have seen the power of the market. All of the evil doubts that take so many out of this game don’t have that affect on me. I start to concentrate. I remember all of what I have learned as a student, and stop focusing on all of the challenge that has also come with it.
I start to perform better. I trust myself with more & more money. I am now in a cabana in Nicaragua. I take one trade and it more than pays for the cost of my stay. My dream is realized.
If you haven’t made it past the point of no return, REMEMBER what it was about trading that you wanted badly enough to make you start. If you’re not yet there, you’re probably closer than you think!
So you’ve been trading for a while? Are you making any money yet? Really?
If you are earning consistent gains in your account and have figured out a personal frame work to grow your account, then disregard this writing. If NOT, read on.
Looking at compounded account growth on a spreadsheet seeing how lucrative it would be to ‘lot up’ weekly and bypass small withdrawals seems like a no brainer. Why then do the vast majority never accomplish this?
Remember how here at the Forex365Institute we teach that trading is 90% psychological? Let’s look at a psychological effect that can take place if you are of the mindset that you are going to compound a small account. Take for example Trader A and Trader B.
Trader A makes his initial deposit. This is usually between a few hundred and a few thousand dollars. Game on. His account grows. At this size of account, he is trading between a $1 and$5 pip. He has an amazing month. He pulls over 200 pips. This nets him a profit of over $500.
He tells himself, ‘I am on my way to the big bucks!’
The next month the market ranges out for a few weeks. Trader A enters a slump and eats up most of his profits by trading aggressively on a lot size higher than month 1. He is fueled by the excitement of running up his account, and soon by the frustration of not repeating month 1’s performance. The losses are overlooked because, ‘Hey, at least it was the houses money.’ Months of this purposing follows. Friends and family ask about trading. He’s embarrassed. His subconscious mind starts to disconnect from the money he deposited initially, and worse, from the hope that fueled the journey to learn to trade.
A year goes by. Trader A has lost his enthusiasm, his confidence. Life is frustrating.
Trader B trades opens a $1000 dollar account and expects very conservative growth. 45 net pips/month is AMAZING to her. She easily achieves this and WITHDRAWALS her small profit. She takes her $150 dollars and treats her husband to a fun date, courtesy of her FOREX profits.
He encourages her to continue waking up early and is happy to help. The next month, she looks patiently for set-ups she trusts. Her account grows again. This time, she treats herself to a car detail. Now she is rolling in evergreen scented bliss courtesy of her efforts in FOREX. Her subconscious mind loves trading.
Trader A is looking on scornfully, because after all, he didn’t come here to make $150 a month. After a year of achieving her $150/month profit, Trader B receives a nice $5000 dollar tax return. She trusts herself completely to use this money to trade. Immediately, her profits go from $150 to $700+ dollars/mo. This affords her the ability to take a vacation and she hasn’t taken a vacation in years. Her friends want to know more about that FOREX thing. Life is good, and the future looks bright.
End of story.
The point of this story is not to tell you how to manage your money. It is however, something worth considering if you have been trading for a while and feel like Trader A. Maybe, just maybe, the tortoise who isn’t consumed by the greed of the lot ladder, is the one who ironically wins this race.
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Here is what happened in today’s market.
Here is what happened in the market for the Federal Rate Decision.
Here’s what happened in today’s Market.
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