How much do Forex traders make per month? What is the monthly earnings potential of the average Forex trader? Your initial reaction may be discouragement, but there is a light at the end of the tunnel. Please fight the urge to roll your eyes and move on to something more uplifting. Despite what you may have heard about how easy it is to make money in the Forex market, the truth is that most traders fail.
The real reason traders fail is probably not what you think. Most new Forex traders have unrealistic profit expectations. They have dreams of turning their small account into a very large account in just a few years. This is totally unrealistic. If it were possible we would all be doing it. In order to shoot for such a high goal, you will be pressured to take bad trades, overtrade, and overleverage which brings me to my next point.
Poor money management is one of the worst account killers for new traders. This goes back to greed, because traders typically overleverage while shooting for unrealistic profit targets.
Risking more than a small amount per trade is a death sentence for your trading account because all trading systems go through periods of drawdown. Not only does responsible money management help preserve your capital during losing streaks, it also helps to keep you trading your edge mechanically. I cannot stress this point enough. Testing is the backbone of a successful trading program. Most new traders are too impatient and undisciplined to thoroughly test new strategies.
You want to get that account snowballing quickly, but this is a costly, rookie mistake. Next, I would forward test with a demo or micro account the new strategy for, at least, a few months. The more time you spend doing this the better off you will be down the road because you will have absolute confidence in a system that has proven to be profitable over time.
Most new traders lack discipline in every aspect of their trading, from testing to execution. It takes discipline, as well as patience, to properly test a new trading strategy. They simply learn a new trading method, and demo trade it for a week or two, or worse, they go straight to live trading.
With discipline, you will be able to keep pulling the trigger on the next trade and let your edge play out over time. Sometimes you just have a bad feeling about a trade, although it meets your criteria. There is limited room for some subjectivity in some aspects of trading when you become much more experienced, but you should strive to trade as mechanically as possible even then.
Lack of discipline can also lead you into catastrophic behaviors, such as overleveraging which I mentioned above and revenge trading. Overtrading could be mentioned in the same breath. Successful, disciplined traders trade less, because they only take the best trade setups. They have the discipline to wait for the market and their trading system s to provide them with quality setups, rather than trying to force bad setups to meet some unrealistic profit target.
As of right now, there are three profitable trading systems reviewed on this website that I have personally traded and recommend. You just were not confident enough in them, or disciplined enough to let their edge play out over time. The point is to find a system that makes sense to you, and test it to see if it actually works. Just as importantly, you need to test it to prove to yourself that it will be profitable in the long term. Once you do, you simply have to continue to trade the edge that your system provides for you with discipline.
Even the best traders in the world lose lots of trades, but they have the discipline to let their edge play out. This question is more in line with the way you should be thinking, although its answer may be just as discouraging: Successful traders simply trade the edge that their trading system s give them, and take what they can get.
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I like your site, not that its particularly important, but the font you use in your articles and site are very nice. I look forward to wading through your articles, and give your recommended trading systems a try out. Thanks for the kind words, J! Let me know if you have any questions. Are you using a profitable trading system? Some people would tell you to demo trade first, which is actually not a bad idea. Your plan sounds good to me. Hi Chris Thank you for the helpful article.
I thought this is impossible, specially doing it constantly! Notify me of followup comments via e-mail. You can also subscribe without commenting. Chris June 19, Sen August 4, Chris August 4, Hi Sen, Thanks for commenting! Hi thank you for your article. Chris October 27, Sara October 29, Could you please clarify, thank you.
Chris November 1, Hi Sara, Thanks for reading. Add Comment Cancel reply Notify me of followup comments via e-mail.More...