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Do you know what differentiates a process from a project? Put simply, a project has a start and end date. A process on the other hand is ongoing with no definite end date. Becoming a successful Forex trader is the latter.
I talk to a lot of traders during the course of a week. Between the member’s area and the emails I receive from this site I hear from hundreds of traders each week.
Below are two of the most common questions I receive.
While there isn’t anything inherently wrong with the curiosity that prompts these questions, I fear that those asking them are putting the cart before the horse so to speak.
In today’s article we are going to discuss why successful Forex trading should be thought of as a process rather than something with an end result. You will learn why breaking down larger milestones into manageable goals is so important as well as how to begin focusing on the process and not the profits.
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Ever heard someone say, “you have to learn to crawl before you can learn to walk”? How about, “you have to learn to walk before you can learn to run”?
For those who aren’t familiar with these sayings, they refer to the process of becoming incrementally better at something before you can achieve proficiency. For you, that “something” is Forex trading.
Every single trader begins their journey at a similar starting point. They hear about the idea from a friend, read a periodical or perhaps they see it in a movie. Regardless of how or where they heard about trading, they all started from the ground floor.
In other words, everyone begins their trading journey at the crawl stage.
Sure, some of you may have started with a degree in economics or finance, but I don’t think anyone will argue with me when I say that a degree won’t help you to determine key support and resistance levels. Nor will it give you the upper hand when analyzing a trend or identifying bullish or bearish price action.
My point here is that regardless of your background, you have just as much potential to become a great Forex trader as anyone else reading this. The only limiting factor is your current experience in the market. In other words, you have to learn how to crawl before you can learn how to walk and you have to learn how to walk before you can learn how to run.
Have you visited any popular Forex-related forums lately? If so I’m sure you have seen at least one post from someone who is claiming proficiency as a Forex trader. They either state that they are consistently profitable or even that they trade Forex full-time.
Invariably these posts get a huge amount of attention. But instead of a, “congratulations, how did you do it?”, we typically see a, “ha, yea right” kind of response. Even for those who don’t comment, a negative thought such as this isn’t unusual.
Why is that? Why is so hard to believe that someone who doesn’t come from a privileged background could make it as a Forex trader?
One word, fear.
These thoughts of disbelief are your mind’s way of protecting you from pain. In most cases it’s the pain of trying and failing.
So instead of believing it’s possible and complimenting this person, most will tell themselves that it isn’t likely so therefore how could this random individual have accomplished something that has a 90% rate of failure?
This presents a contradiction. If those commenting in disbelief aren’t willing to believe that someone can become a successful Forex trader, why are they commenting in a Forex-related forum in the first place? In other words, why try at all?
The answers to those questions go far beyond the topic of this article. But I think you get where I’m going with this.
It’s imperative that you cast out any disbelief about the possibilities of achieving consistent profits as a Forex trader. If you truly want to become a successful you have to believe without a shadow of a doubt that you can and will do it.
As a Forex trader, you shouldn’t be trying to beat the market nor should you be trying to make a certain amount of money each month. The only thing you should be focused on each and every day is the process by which you can become the best trader you can be.
Doesn’t that involve monetary goals, you ask?
Not in the slightest. Any milestone you reach of monetary value is simply a byproduct of the process you went through to reach it. In other words, you reached that milestone because of the many things you did right along the way, not because you focused on the milestone itself.
When interviewed before a game, a professional athlete never says, “we hope to score more points than the other team”. Of course that’s how a game is won but it isn’t why a game is won.
Instead the professional athlete will say something like, “we need to go out and execute our game plan and do what we do best – limit mistakes and capitalize on opportunities”.
Notice how the athlete makes no reference to beating the other team by scoring more points. Instead he/she is focused on the process that will lead their team to victory.
The same goes for your journey as a Forex trader – you have to begin focusing on the process that will lead you to consistent profits rather than focusing on the profits alone.
Don’t make the mistake of aiming for a $1 million trading account each and every day. If that’s your ultimate goal, great, but don’t make that your daily focus. Instead focus on each piece of the process that will lead you to consistent profits.
By focusing on the process you will not only reduce your levels of stress but you will also begin to foster a growth mindset.
The stress a trader faces is due to expectations, usually in the form of an expected outcome for a given trade setup. A process-oriented approach relieves this stress because you are no longer putting pressure on yourself to win every time. Instead you are focused on executing each part of the process as effectively as possible.
Begin putting the focus on each part of your trading to include things such as effective money management, identifying key levels and only taking the most favorable price action setups. Master each part of the process and the profits are sure to find you.
Every single person reading this has the same goal – to become a successful Forex trader. Naturally the details of those goals will differ, such as wanting to trade for a prop firm or manage a private fund, but the goal of consistent profits is the same.
Make no mistake about it, that’s a massive goal and one that will take no small amount of experience to achieve. Of course the differentiating factors between someone who reaches it in five years versus someone who reaches it in one year are extremely broad.
But I don’t want this to turn into a post about the characteristics of successful traders. Instead I want to focus on the idea that in order to view success in the Forex market as a process and not a project, you first need to adjust your thinking.
Having a goal to trade for a prop firm or manage a fund is great and it’s something I would encourage everyone to have. But if that’s the only goal you focus on each and every day, you stand a greater chance of getting burnt out than someone who breaks that large goal into bite-size pieces.
Instead of waking up in the morning and saying, “I will trade for a prop firm one day”, try something more manageable such as, “I’m going to learn the 50% entry strategy today”. You have a much greater chance of accomplishing the latter in a single day. This is what we call a “quick win”.
Start giving yourself one or two of these quick wins each day. It could be something as simple as getting your chart configured in a way that works best for you. It doesn’t have to be momentous.
These “quick wins” will create momentum and as that momentum builds you will find yourself accomplishing larger goals without even knowing it.
I want to start bringing this post to a close with something that is absolutely, without a doubt, 100% essential if you wish to succeed as a trader. That thing is passion.
You must have a passion for trading if you want to succeed. There is no other way to say it and there is certainly no substitute. An unwavering passion is what will drive the continuous effort necessary to realize consistent profits in this business. Anything less will never yield the results you desire.
Of all the things I can teach to an aspiring Forex trader, passion isn’t one of them. You either have it or you don’t.
What I can tell you is this – if you have a true passion for trading and a burning desire to become successful, you will make it. Because you can’t fail if you never give up.
The journey to become a successful Forex trader never ends. You will face struggles and enjoy lessons-learned after 10 years of trading just as you did after 10 months of trading.
The frequency and magnitude of these struggles and lessons-learned will of course change over time, but the process of learning and refining your trading edge in the market never ends.
Just remember to always break larger goals into smaller ones. Make these quick wins a part of your daily routine and before you know it you will reach your ultimate goal of becoming a consistently profitable Forex trader.
Above all else, be sure to keep the focus on the process and never the profits. Learn to enjoy the obstacles as much as the successes, knowing that every obstacle you conquer puts you one step closer to your ultimate goal.
What are your goals as a Forex trader? Do you see yourself approaching those goals differently having read this article?
Share your experience or simply leave a comment below.
Justin Bennett is an internationally recognized Forex trader with 10+ years of experience. He's been interviewed by Stocks & Commodities Magazine as a featured trader for the month and is mentioned weekly by Forex Factory next to publications from CNN and Bloomberg. Justin created Daily Price Action in 2014 and has since grown the monthly readership to over 100,000 Forex traders and has personally mentored more than 3,000 students.Read more...
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