how do i know if i am getting better at forex trading?
1. You Begin To Focus More On Risk
By the time you begin to mature as a trader, it will become more about how much risk a trade poses rather than how much reward you are expecting to get. This means you will not jump into every trade setup you see. You will only pick the ones with the lowest risk.
2. You Dont Hold On To Losing Trades
When maturing as a trader you will begin to cut losing trades early and let profitable trades run longer. You will not be holdong on to losing trades hoping that the tide will turn around.
3. You Trade Only Few Instruments
As a maturing trader, you will realize you no longer trade every pair you see. You will begin to stick to trading only a few pairs where you have a strategy that works or an edge.
4. You Trade Less Frequently
As a maturing trader, you begin to realize that trading is a game of probability. The more trades you take, the hgher the probability that some of the trades will result in losses.
5. You Only Trade At The Begining of A Session
You will realize that the fore market timing is u-shaped and most of the monentum is gotten at the start and end of a trading session.
You begin to become a better loser. You take losses better as you mature in trading, you begin to realize that your next trade is your best trade. Remember, the best loser is the one who wins in trading.
As you get btter in trading you will notice that you become more patient and wait for the market to act before you react. You will no longer be jumping at every little move you see on the charts hoping to make a quick buck.
You are becoming matured in trading when it feels boring. Trust me, this is the actual sign of a matured trader. It actually means you will be patient.
1. You start looking for more advanced trading platforms
When I started trading, I was content with using MT4 to trade but as I got better I began to desire more features causing me to download MT5 and then as I got better I upgraded to TradingView and finally settled for the advanced cTrader platform.
2. You start looking for low spread brokers
I started trading with HF Markets and initially I didnt notice how high the spread on their premium account was (up to 1.6 pips on EUR/USD). However as I got better, I realized the high spread was affecting where I could place my stop loss, I kept getting stopped out easily. Because of this, as I got better I asked my mentor to recommend a low cost broker and thats how I switched to Trade Nation where I got 0.6 pips on EUR/USD.
3. You spend less time in front of the charts
When i started trading, I was always in front of the charts taing every trade i saw. However as I got better, I began creating trading rues such as specific trading hours, daily loss limits etc. These rules helped me trade less frequently for example once my daily loss limit was reached I stopped trading for that day.
4. You develop a trading strategy (and stick to it religously)
As a beginner, I didnt have a trading strategy so I was always trying out different stuff every day. As I got better, I researched and found a strategy that worked on EUR/USD, GBP/USD, and US30; and I stuck to it without deviating. Everyday, I traded the same strategy irrespective of the outcome (profit/loss)
5. You accept losses as gifts
In every loss there is a lesson, so as i got better in trading I stop being angry at myself after a loss. Instead, I look inward for the lesson to be learnt from that loss and how not to repeat the same mistake twice.
6. You set your stop loss where it needs to be (not where you are comfortable with)
When I started trading, I used to set very tight stop losses because of the fear of losing. Because of this I was always getting stopped out over and over again. With time, I learnt that a stop loss needs to be set at the most appropriate distance from entry even if it means risking a higher amount than I was comfortable with.