Forex Trading Articles

WHAT SEPARATES WINNERS FROM LOSERS?

Forexmentor Team
© 2007, Currex Investment Services Inc.

Jan 4, 2007

Trading is a mind game. Training a trader’s mind is the first step for any successful trader, but almost all new traders neglect this part and that explains why more than 90% of traders fail in the long run. It is a proven fact that the difference that makes the difference is the mindset of the winning trader, good judgment and quick reaction to the information received. Most traders today are linked to the same information sources; it is how they respond to this information that separates winners from losers.

Instead of thinking like any other normal person, you need to start thinking like a speculator. Winners are probability thinkers. They understand that trading is all about thinking in probabilities NOT certainties. They consider the probabilities, evaluate them, and go for them when they are in their favor.

The decision making process may be long and there might be some planning behind it, but sometimes traders seem to take too long to take a decision and often that ends up being a wrong decision. This is one of the most important things behind success or failure. Some traders make quick decisions, but are not able to follow them, and as a result they end up being on the losing side. Other traders can’t make up their minds, because they really don’t know what they are doing. They don’t have a plan, or rules to guide them and therefore are uncertain of what they should be doing.

The reason why people avoid making a decision is because it’s painful and traders often have a ready assumption that their decision might not be the right one. The Forex market is playing with their mind, but they are not able to understand that. If they can have confidence in what they are doing, they will be able to support the pressure.

At the end of the day, everything depends on the trader’s ability to take a decision in spite of knowing that there is no guarantee to the Forex movement and taking a right decision. The Forex market and its ups and downs are always going to be there. The Forex trader has to keep cool and be disciplined. It is like mentally preparing yourself in advance for what lays ahead, so that you will not be caught off guard.

Winning traders are disciplined: Winning traders discipline themselves to do what needs to be done. They know their rules and they follow their rules. Winning traders have a plan and they work the plan. Winning traders are patient.

Winning traders are conflict free: The people who succeed at trading, the people who succeed consistently at any endeavor, are people who are conflict free about their endeavor. They are clear about their goal of becoming a consistently profitable trader, and all parts of their beings are in alignment with their goal. They are comfortable with taking a calculated risk and waiting to see what happens. They are comfortable within the process of both winning and losing. Both are expected and accepted. Winning traders are comfortable in the market. The market is where they want to be and trading is what they love to do.

Winning traders expect to win: They associate trading with pleasure. The pain is only temporary on the way to greater pleasure. They set their intention. They intend to make money and to follow their winning methods as well as to constantly improve. Improving and making money is total pleasure. The rest is secondary.

Winning traders do their homework: They research their methods. They verify their methods and they stay up-to-date with current markets. They practice mental rehearsal. They keep themselves mentally and physically fit.

Winning traders are confident: Their confidence is not dependent upon the results of a trade. They know that whatever happens, they can make the money back.

Winning traders understand that trading is a game of probabilities: Winning traders are probability thinkers. They understand that trading is a game of probabilities, and unlike some losing traders, they never expect to have an absolutely certain outcome. They realize each trade is only a probability and they always control the risk.

“No profession requires more hard work, intelligence, patience, and mental discipline than successful speculation.” --Robert Rhea

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