There are some fantasies and imaginations that run through the minds of most forex trading beginners especially when they have had a first win or a few wins in a row (often referred to as beginner’s luck).
Imagine waking up one morning and whilst relaxing on your couch you were making millions by just watching some charts and lazily pressing some buttons to take trades? You will obviously think to yourself, “If this is how making money is easy, then I will be a billionaire within the shortest possible time”.
Sometimes, traders experience a series of good emotions and great imaginations that persist until they face a loss in a trade. Even then, they might still believe that they can recover until they suffer another loss, which may unfortunately lead to a losing streak of trades. This can cause significant distress, but the worst-case scenario occurs when a trader blows their account.
It is at this point that some intriguing questions begin arising in their hearts. Examples of such questions include: “Is it possible to make consistent profit in forex or is it just a myth? Can I become a billionaire through forex trading? Is forex trading for everybody or some selected few? Are people making it in this industry or is it just a make-believe? Do I need to learn a new strategy or improve upon what I know? Etc.
What do you think, is it possible to make consistent profit in forex? Of course, yes. The likes of George Soros, Stanley Druckenmiller, Steve Cohen, and Ken Griffin are some of the few who became billionaires through forex trading.
Whilst some are making millions a day in forex trading others keep blowing accounts here and there. The few individuals who are making it or are experts in this market have developed some good habits over the years that most people who start their trading journey are yet to develop or are oblivious to.
Whilst understanding the good habits leading to consistent profit-making in the forex trading industry, let’s consider some fictions or the myths most people enter this business with accounting for the distasteful experience of blowing their accounts.
MYTHS ABOUT FOREX TRADING
- Forex trading is an easy way to become a billionaire or become successful.
What most traders especially beginners do not know is if forex trading is a quick way to become a billionaire there would be a lot of billionaires. This assertion is hinged on the fact that in the comfort of everyone’s home, they can be trading the forex market and hence become billionaires without engaging in any physical hard work.
Forex trading involves a lot of hard work, discipline, and self-control, amidst the perfecting of an individual’s strategy and skills. These habits might take traders several months and years to build if they consistently practice without relenting especially using DEMO accounts and live accounts. While not downplaying the possibility of becoming a billionaire through forex trading, it is of utmost importance to treat it like a business with a prudent mindset and the setting of long-term goals.
- There are 100% trading strategies and setups.
As a trader, it’s essential to understand that there is no perfect strategy or setup that guarantees a 100% success rate. One of the most common misconceptions in trading the forex market is the belief that the market can be analyzed and predicted with absolute precision. It is important to note that the forex market is influenced by a wide range of factors such as geopolitical events, economic indicators, market sentiments, etc.
This is a major reason why every trader must adopt the right risk management and money management strategies to maximize their profit as well as stay long in this market because these factors make accurately predicting the market a challenge. Given this, the experts or successful traders estimate market predictions as a probability, not 100% setups.
- To be a successful trader you must trade every day and every time.
The forex market operates 24 hours a day, 5 days a week, but there’s no guarantee that you can make a consistent profit at all times. You must understand the market structure (impulsive moves and corrective moves) as well as the behavior of each market session.
The market goes through moments of high volatility, especially during the impulsive phase of market movements before culminating in moments of low volatility during corrective phases.
It is to the advantage of traders to find the best times to trade according to their strategy and preferred currency pairs. The best is to ensure you are taking your trades during the impulsive phases of the market
Conclusion
Making a consistent profit in the forex market is a reality, not a fiction at all. Notwithstanding, traders must know the rules of engagement in this financial game, play accordingly and they will be successful. Learning from the experts, perfecting strategies, effective trading psychology, good risk and money management skills, combination of fundamental and technical analytics are sure ways to make a successful trader.
