Warren Buffett once noted that in the stock market, money flows from the impatient to the patient. The most famous investor in the world was right, and his wisdom may be applied to Forex. Real success comes to those who can take thoughtful action. You do not need to be active all day long. Instead, make a few right moves and take home a tidy profit.
What do traders do? A Forex strategy can be compared to the hunting behavior of a lion. The predator patiently waits until the prey strays away from the herd. Rather than attacking the group, they will bide their time. They focus on the weakest member and get their dinner.
Ambitious traders should follow this example. Hectic activity throughout the day does not bring you closer to the goal. Sometimes, several measured steps are all you need.
You may also think of yourself as a sniper. Trading is like stalking and anticipating the best moments for a shot. A sniper will never rush the process, shooting randomly at whoever comes into view. They take down their target at once.
What Do Traders Do? They Wait
Good things come to those who wait – this is more than a cliche. Trading losses may result from excessive activity. At the end of the day, those who never stop will fail. Take action when you have a solid rationale. Be patient. Wait for the moment when several factors point in the same direction. You will not achieve anything with reckless decisions. Accept the risks but don’t be foolhardy. Otherwise, you will see your account depleted in no time.
What do Forex traders do? Their job is not easy. To succeed, you need sufficient time and effort. Choosing the right asset is only the beginning. Every day, you will spend time analyzing charts, news, and indicators. Your goal is to identify signals for buying or selling.
Large profits may be ripped with high volumes or buy leverage. Both schemes involve significant risk, so you should always start small. In fact, even experts steer clear of leverage unless they really need it.
Traders Control Their Emotions
Financial skills alone will not guarantee stellar performance. You need to be patient and master your own emotions. Self-control is extremely important, as trading is a waiting game. Sometimes, you will need to wait for weeks. Some market cycles simply do not allow you to profit, however hard you try. In such situations, you need to sit back and wait for a confluence of factors to appear. Being passive pays off.
For many people, waiting is a challenge. They are affected by momentary changes in the market. Short-term spikes and dips cause them to act impulsively. This is perfectly normal, as humans are emotional beings. Still, they can analyze and control their motivations.
Never trade when you are upset, scared, or overjoyed. Strong feelings always cloud our judgment. When you experience them, take a break. Wait until they pass.
Traders Should Manage Their Risks
Do not expect smooth sailing and never lose sight of the risks. This gigantic market may always turn against you. Even seasoned experts have losing trades at least occasionally. The more accurate your analysis – the more likely the success. You may consider yourself victorious if over half of your trades result in profit.
If you are not used to waiting, you have low chances of being triumphant. Chasing losses, and being overly active are two features of a flawed mentality. If you cannot wait to make another move, you are destined to lose what you have.
Read How to Trade Forex with $100 here.
When the market looks especially positive, fight the urge to open more trades than you planned. If you encounter a loss, never chase it. Instead, take a step back. Reevaluate your strategy to find deficiencies in your strategy.
What do equity traders do? They follow the same logic. Learn from the great and mighty Warren Buffett. Before he got access to millions, he patiently waited for the right moment. Jumping at the smallest opportunities was not his style. Instead, he carefully selected his next moves and traded thoughtfully. Eventually, he purchased a gigantic business and took over the multinational giant holding company Berkshire Hathaway.
His career is a classic example found in many books and movies. If you need some inspiration, watch the brilliant documentary called “Becoming Warren Buffett.” This man is one of the most gifted traders this world has ever seen.
Read about How to Check That Your Forex Broker Is Trustworthy here.
The Bottom Line
Sometimes, Forex traders benefit from doing nothing. Patience is an important strength that you need to develop. Rather than jumping at every opportunity you see, calculate your moves and trade mindfully. The market is always moving, and the temptation to trade is strong. Avoid taking action when you really should not. Be a lion.