An FX Traders Mindset . . . Part 1

While trading the Foreign Exchange Market can be exciting to most traders, it is in fact the challenge that faces the traders appetite for risk that makes it more attractive for some who would be willing to accept the loss of funds at a certain degree in exchange for the potential gains that the market offers. However, a traders' mindset through the course of trading experiences could be developed by proper training. As traders and strategist learn from mistakes made in the past. Experience has always been the best teacher. But it is in the correct moves and trades that should be keenly noted on how winning positions were done.


Making the same strategic moves twice or more that delivered the winning results should be noted and kept in place at all times. Although there is no guarantee that it will be the same in the near future. However, if such practice is done more, the probability is greater for a win than a loss. Practise makes perfect, so to speak. It is in the mindset and training on how the appropriate approach is done and repeated. Easier said than done!


A more traditional form is to apply the strategy of eliminating signals that can be deceiving to ones' view point. A clear example is viewing the technical charts on different time sequences, where each chart can show a negative or affirmative direction ( false signals ) from one another. And most of the time, for the trained eye it is clearer for them. But doesn't work for others. The overall summary can be seen on a bigger picture like the weekly and monthly charts provide. This also depends on the type of trader, either a short term or long term trader. On top of it is a matter of account size that needs to be considered as well.


A few combinations of technical analysis maybe quite helpful in eliminating these misleading signal like the price breakouts from a trend or the comparisons of the open, high, low and closing prices for the previous weeks. With the increase and decrease of volumes and open positions in the market it can be defined. This is just some of the ideas set to train oneself while trading specially in the Foreign Exchange market.