3 Ways To Improve Your Trading Career

One of the main dilemmas traders are facing, especially if they just got out of their trading 101 course and are new to the lifestyle, is the cycle of success and failure. Many traders who are just starting out get a good trade, get excited, then get a bad trade right after. Perhaps not in a trade after trade manner, but that’s a common pattern to observe.

That type of behavior is dangerous to day by day trading. Most traders end up in a long term cycle of trading hard every day, day in and out without fail – and those traders are the ones most likely to not make the kind of profits they want to see.

Over analysis, confidence issues and lack of emotional control are often key factors in this. Bad decisions leading to worse decisions, with traders doubling down on decisions that they have first hand experience in failing with.

There are ways to break these habits, of course. Let’s look at something not covered in a classic forex trading 101 guide – how to evolve your career from a newbie to a pro.

• 1) Give Your Trades Time

The lack of patience and the consistent need for traders to trade is one of the most mindboggling and dangerous things you’ll see less experienced or less successful traders do. Chasing a chart that updates every couple of minutes is one of the most counterproductive things to do in trading.

It is highly recommended that traders stick to daily charts. Daily charts are far more reliable and give a proper overview of a trading day can play out, because what matters at the end is how the day ends and not how it started. This goes hand in hand with the idea of trading at the end of the day only.

Going in with trading on daily charts allows for focus and better decision-making. There literally dozens of fake signals that a hourly (or even more frequently updating) chart could be sending you, causing you to get cold feet and end up losing money on a trade.

• 2) Trade in Quality, Not Quantity

Hollywood has done a great job of romanticizing an insane trading lifestyle of a guy in suit pulling his hair out as he has a meltdown watching a trade go south. Real life trading is very different as people tend to forget that movies are meant to entertain, not provide a guide to real life.

Trading less but really focusing on the trade can be one of the most beneficial moves for a trader’s career. It allows them to really plan out a trade. It gives them an opportunity to make the most of their capital and take slower trades with higher risk. Instead of going into 100 trades per month, you could go into 10, each of them worth 10 times more risk.

• 3) Understanding Price Action Signals

Understanding Price Action Signals, as well as Confluence, are two key concepts that can really bring a trader’s game to the next level.

Price Action is a price’s movement over a specific amount of time. Understanding these goes well together with understanding historical data as you can see patterns in price movement and trade on reoccurring patterns.

Confluence is the point on a chart wherein a signal crosses a level. There are a variety of confluence points that can exist, and researching them and understanding what type of opportunity the represent is a good way to get leads on potentially profitable trades.

Instead of going far and wide and looking at everything, using Price Action and Confluence applied to a specific market, for instance a popular forex currency pair, can allow a trader to become a bit of an expert in a field and really profit from there.