It may seem as if developing a career in forex day trading is about finding a strategy, practicing it regularly, and making bundles of money. Yes, it is about that. But, where are our characteristics on that list? To become a successful day trader, you need to develop specific features to implement an effective strategy that delivers results in all market conditions.
We may not be entirely aware, but we do use them daily and maybe, at times, we notice that we should work more on developing these. These characteristics are innately apart of us. It is essential to work on developing these characteristics that guide you towards building a thriving day trading career.
It is good to know that not all successful day traders inherently have the ability to succeed without hard work. For most, it takes weeks, months, and years. By continuing to read, you will realize why you should develop the skills sooner rather than later.
Discipline requires boundaries and mental acceptance. It’s one of the many characteristics used to achieve in day trading. Even though some beg to differ – they say that a well-developed trading plan was their way to success. But how disciplined are they to follow it?
Being disciplined is vital when deciding which products to trade. Thousands of products are traded throughout the day, and It is very overwhelming with infinite opportunities thrown to you at once. Devise a schedule that revolves around the best times for you to trade. Select a product to trade and stick to both the product and your plan.
Your time spent trading is valuable, decisions are made in real-time, and it’s simple to mess up your trades. You can become distracted, skip some, take more than you should, hold on for too long or even prematurely exit some. A disciplined day trader will recognize trading signals and know when to act on them. Many things happen in the market at the same time, and undisciplined traders are usually impulsive and do not look at the bigger picture.
Disciplined day traders will understand that doing nothing when nothing is happening in the market is okay. But also, they generally remain alert for potential opportunities ahead.
If you haven’t started trading yet, you will soon realize that it is a “waiting game” with loads of patience needed – but with fantastic profit too. It can be a challenge for beginner traders who don’t have enough patience and find it challenging to wait or watch the markets. If you enter the market at a time when nothing is happening, you may blame your luck and try to jump in or out of the trades too early. You may land up building resentment, and it will not suffice.
By working on developing your patience and also learning to identify a call to action without hesitation, you achieve more. For example: during your waiting stages for the best entry and exit points – focus on acting immediately once sensing a chance. It’s a cat and mouse game. You sit and wait for that exact moment, which could only be for a few seconds, which is also followed by prolonged hours of inactivity. Patience can be most frustrating, but then again, it has a whole lot of reward for you.
Change is a characteristic that is either always welcomed or never welcomed at all. When becoming a trader, you will accept that day trading as a career in ever-changing. To be a successful trader, you will have to work through some discomfort to adapt to fluctuations quickly. It is extremely rare to have two trading days that are the same or similar to one another, which means you must adjust to different scenarios in the market.
Having said this, a trader’s strategy must be flexible, so that there are fewer problems when adapting to the market. Lessons to take from successful day traders is to implement multiple strategies in various market conditions, which teaches them when they should or shouldn’t use a trading strategy. Also, another lesson is to base these strategies on the conditions present on that day, and not think about what happened in the markets on the previous day.
Adaptability in trading is not only about shifting your techniques when necessary but also about adapting your mindset too, which isn’t easy at all. It takes immense mental courage to change your strategy quickly, but that is what traders should be willing to do.
Day trading is about gaining the mental strength that can withstand the losses that the market throws at you. Some days there can be no losses thrown at you, yet on other days, this is all you will see, and it can be soul destroying. More positively, there will be times when you are on a losing streak, and it’s at this stage when the pro traders are looking for opportunities to bounce back. If you are disappointed after losing a trade or if your strategy isn’t delivering the results you expect – do not be disheartened.
So, brace yourself when reacting to your losses because you will lose more trades than you will win and allowing your anger and frustration to get the better of you is not a good decision to make. Even the most successful day traders tend to lose trades every single day. The difference lies in your ability to bounce back after losing one or multiple trades. Do not allow this to affect you. It is possible to make a profit still even if you lose more than you win, depending on the size of your wins in comparison to your losses.
Professional traders are prepared mentally to deal with losing streaks, which are more common than you think. It requires immense rational and focus on moving through a losing streak, and to not allow the losses to cloud their judgment. Now, mental strength comes to the fore since it enables you to execute your trading plan without deviating from your strategy. There will be some hard losses but learn, as this is the only way you are going to gain experience as a day trader.
Preparations for your losses doesn’t mean that you should continue grinding it out on the market and continue to lose your capital. If your mental strength gives you the courage to walk away from the suffering of your continuous losses – do that! Walk away! Some traders see walking away as a way to give up. Sure it is giving up on your trade. Its positively giving up – you know that if you do not walk away, then it will be to your detriment. Most traders don’t know when to call it a day. Also, if your trading strategy isn’t working, then the market’s conditions aren’t in favor of your strategy. That is the signal to stop.
At the beginning of your trading career, it is a good idea to reach out to fellow traders and mentors to help you with the building blocks. These contacts will recommend trading videos, podcasts, books, forums, and articles to build your skills and confidence. However, if you want your trading career to take off smoothly, then learn some of the critical skills by yourself. Develop a sense of independence, where you do not rely on others. Having to rely on help or opinions all the time is tiresome. Not to say, that the ideas and opinions of others are unimportant. But, use your discretion about when to be more or less dependable. Professional traders agree that they managed to find success this way.
Once you have developed a trading strategy that works, you should not listen to every opinion from others. Be focused on doing what works for you. Gaining independence as a day trader doesn’t mean that you are going to take on the world alone. Independence is about concentrating on working on your trading strategy without copying or following someone else’s. There will be times when you would like to have help or opinions from others. It is important to have someone you can rely on for all types of trading support.
After implementing these six characteristics to build day trading as a career, you will get to a point where you are satisfied and comfortable enough to change your career. Become that day trader. You can do it!
Photo by Chris Liverani
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