Why is precision not necessary for FX trading?
As a result of the feel-good element, it is only reasonable for a trader to anticipate that they will have a higher win percentage in the transactions that they make. When we are successful in a transaction, this demonstrates that our analysis was accurate and that we had the proper idea about the path the market would take. But, oddly enough, we are going to explain to you today why accurately anticipating the result of a trade or having a high win percentage is not as critical when it comes to being a savvy investor.
You must consider this because market participants are forced to accept the reality that they will sustain losses consistently. These are the possible outcomes when your prediction of how the forex market will move is inaccurate.
To succeed, being correct is secondary
How well you can predict how the market will move won’t have much of an effect on how well you do in forex trading. Even while you’re more likely to be wrong than correct when trading, that doesn’t imply you can’t make money. Consequently, it is crucial that we learn to let go of the need to always be right about the market, both in terms of our attitude to forex trading and our overall trading success.
The importance of win % and the ability to correctly predict the outcome of a deal is negligible to your profitability as a trader, but this is not obvious at first glance. Most market participants rarely consider the possibility of being wrong while making money. When they enter a deal, they are more confident that they will make the proper decision. Whenever we enter a new market, we do everything we can to ensure a successful outcome.
However, this contrasts with the truth that our success is not guaranteed in every situation. Therefore, when we make a bad deal, we tend to feel a lot of emotions. This is because, especially in forex trading, we tend to react emotionally when we experience a loss because our expectations were so far off from reality.
Accepting that we will make some mistakes in our trading is the only way to deal with this situation. We must also remind ourselves that “being right is not a compulsion or a roadblock when it comes to earning regularly in the market.”
You shouldn’t feel bad about yourself if you lose a trade. To keep things in perspective, consider that this was just another time you used your advantage to great effect. If you make about 20 trades, it is mathematically impossible to not lose at least one. So, acting on impulse won’t help you much, especially if you stick to your plan and keep your desired level of risk.
Don’t let having a tiny forex trading account stop you from trying to make money; if you don’t overtrade or overleverage, you should be fine. Instead, you should accept that you can make money even if you lose most of the time if you are consistent with the amount of risk you take and only trade high-probability price action strategies.
Leave your pride at the door when you trade
For some investors, the primary concern is to never have a loss. They tend to take it too personally or let their emotions get the best of them. You must keep in mind that losses are inevitable in trading and try not to let them affect you emotionally. If you put too much weight on avoiding bad trades, you may end up losing money overall because you’re putting too much emphasis on any given trade.
Anyone who has been part of an online trading community knows that traders are much more likely to talk about their successes than their failures. Even if you lost money in the market like everyone else, it’s only human to brag about your wins because doing so makes you feel good. Realize that in the grand scheme of things, your own personal triumphs and achievements don’t matter all that much.
Thus, if you can profit through the prudent use of risk-reward, you can afford to be wrong about some trades more than you are right in the market. Discipline is also crucial when trading a high-probability trading method like price action.
We’re basically saying that your ego should not influence your market decisions. Do not make the mistake of rushing back into the market out of frustration if a deal that seemed good does not turn out the way you had hoped. Instead, you should see it as another sign of how good you are at trading and chalk it up to the fact that you will always lose money. There are two things to keep in mind if you want to be successful with trading: you must eliminate the “need” to make money rapidly, and you must eliminate the “need” to get all your transactions correctly.
Master the art of accepting defeat with dignity
Trading is a fantastic way to test your willpower and ability to avoid making hasty decisions in favor of the long-term by avoiding short-term temptations like trading at the incorrect moment or taking on too much risk. It is very important to keep reminding ourselves that no single trade can make or break our market performance. Our commercial success or failure may hinge in part on that. Instead of going into the forex trading market, unprepared, traders are more likely to be successful in the long run if they are consistent and patient, which leads to higher returns. licensed advisor to the world’s top financial tycoons.
By keeping the big picture in mind and concentrating on the long-term benefits, we will be able to block out the noise of short-term emotional trading. We shouldn’t let a few big trades decide our fate. Instead, we should know that our whole portfolio will be affected. This means that worrying too much about how a trade will turn out is probably not a good idea. Instead, we should train ourselves to accept defeat with honor because it is inevitable along the path, we’re on.