12 facts you didn’t know about a successful forex trader

Millennials are diving head first into online forex trading, without even knowing the requirements needed of them before opening their first trade. Please note that not because someone opens and closes a trade on a whim (ie: no forex trading strategy), doesn’t make him a forex trader.

So what does it take to become a forex trader? The article aims to shed some light on that question to help you find a valid answer so that you can tell or evaluate individuals on their claims of being a forex trader.

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Who is a forex trader?

A forex trader is an individual that has the relevant knowledge, skills, and expertise which he or she uses in conjunction with a profitable forex trading strategy to exploit the forex market to make money either for a living or an extra source of income via among forex trading platforms. 

In this case, the following terms refer to:

  • Knowledge: having adequate information about the forex market, forex trading, and being a forex trader. For your convenience Rhasfx provide a full free forex trading for beginners course.
  • Skills: The ability to estimate the likelihood [probability] of price moving in a particular direction.
  • Expertise: The ability to maintain focus and be emotionally stable before opening, during, and after each closed trade.

Video: How to create a profitable forex trading strategy

How to create a forex trading strat...
How to create a forex trading strategy | break and retest forex strategy (part 2)

What does a forex trader do?

A forex trader is one that monitors the forex market for different trading opportunities which he then opts to exploit whenever presented, with the intention of making a profit for himself and/ or his clients. After opening the desired position(s), he/ she is then required to manage the trades accordingly against the random fluctuation of the forex market movement to avoid unnecessary losses.

Let it be known that the above-mentioned is a lot easier said than done due to the large degree of mental fortitude needed to remain disciplined.

NOTE: It is not easy for many to keep calm after realizing the earning potential of forex trading, or their trading strategy.

How do I become a forex trader?

If an individual meets the legal requirements needed to become a forex trader, then one may do so by creating their Metatrader 4 (or 5) currency trading account with one of the best forex trading platform.

Benefits of becoming a forex trader

Albeit the risk of losing your money is high, there are numerous benefits of becoming a forex trader, all of which outweigh the risk(s) associated with forex trading individually.

forex trader
Risk of trading forex

Some benefits of being a forex trader are, but are not limited to: 

  • Being your own boss
  • Ability to make money at home; via mobile phone.
  • Ability to travel
  • To afford your expensive dream car and/ or house
  • Have an extra source of income

You can read more benefits of becoming a forex trader.

Without further-a-do, let’s look at some of the key principles that make a forex trader who he is.

12 facts about a forex trader

1. A forex trader is patient

In the forex trading world, patience is an extremely valuable asset that can keep forex trading live accounts from being blown in the long run. This is done by keeping traders from entering bad trades and or closing good trades too early, thus minimizing losses.

2. A forex trader is meticulous

Forex traders always take due diligence in analyzing their trades and are even more careful about the ones they decide to enter. This is to ensure that all positions being opened have the minimum probability of closing in profit.

3. A forex trader can control his emotions

A forex trader should be able to maintain his emotional stability after a winning or losing streak. Traders tend to be flustered after a series of losses, causing them to feel compelled to open trades with unusually large lot sizes, casting risk management aside, in an attempt to recover the money that was loss.

4. A forex trader is his own boss

Forex traders pay themselves by being able to make their own money whenever, wherever, however, they wish. This is because they answer to nobody but themselves, as such they can trade however often they wish.

5. A forex trader is a public figure/ social media influencer

As forex trading continues to rise in popularity, forex traders are being eyed as role models in their respective communities or countries. This is particularly true for those that make their success known to the public by posting about:

  1. Where they are coming from as a trader
  2. How much they started with
  3. Where they are now
  4. How much they are making now
  5. The cars they drive
  6. The hotels/vacation they can afford
  7. The house the own

Once people hear about their journey and see these types of achievements, they tend to be inspired. The more relatable a viewer’s current situation is to the previous situation of a trader in topic, the more inspired they’ll feel, and in return the more they look up to that forex trader.

6. A forex trader spends less time looking at his charts and/ or trades

There is a notion that traders are required to always be in front of their computer screen, particularly to be watching the charts. However, I would like to dispel that notion as false. A profitable forex trader spends more time away from the charts than he does doing so.

To be more specific, they spend their time outside* enjoying the money that they made while staying inside*.

7. A forex trader uses MetaTrader to enter and modify trades while analyzing on tradingview

The average forex trader uses MetaTrader or Ctrader to manage or modify the positions opened in their CFD or forex trading account while using tradingview as their main currency trading platform for analyzing their charts.

forex trader

Metatrader for modifying tradesTradingview charts are known to be the best since they offer the widest variety of sophisticated HTML charts with the largest inventory of trading tools needed to analyze given charts among the top forex trading platforms. 

What charts are available on tradingview?

Charts that can be analyzed via tradingview are but are, not limited to:

  • Currency
  • Indices
  • Cryptocurrencies
  • Stocks
  • Commodities
tradingview analysis
Tradingview analysis

8. A forex trader has multiple sources of income

With the substantial amount of earnings a forex trader make, along with the consideration of the coherent risk that comes with forex trading, a trader tends to invest his or her profit into less risky ventures that are more stable as a safety net in case his/ her trading account is blown.

This is a practice of diversifying your risk associated with trading the financial markets.

Forex trader
Diversifying risk

9. A forex trader is not phased by a winning or losing streak

As mentioned above earlier, a forex trader can get emotionally flustered when he experienced a series of losing or winning trades. This is prominent among new traders who just learn forex trading.

In terms of a winning streak, his confidence in his forex trading strategy is boosted, along with his ego. As a result, precautionary measures for losing trades start to become less important to him as he starts to believe he has the “holy grail”.

REMINDER: No forex trading strategy that allows an individual to win 100% of the time.

10. A forex trader is not afraid of losses.

There are times when a trader experiences FOTM (Fear Of The Market), particularly after a series of losing trades. However, as mentioned multiple times above, there is no holy grail in forex trading, and a trader is not phased by a series of losses. As such exploiting trading opportunities that present themselves with a highly favorable probability is what keeps a forex trader going.

This goes without saying that a trader does not dwell on the past (ie: loss trades) but always has his eyes on the future (ie: winning trades that are to come.)

11. A forex trader does not close his trades manually.

There are many different ramifications that come with the practice of closing trades manually. There are times when it’s best to close a particular trade manually to either lessen or avoid a loss completely. However, the continuous practice of doing so can have a negative impact on one’s disciplinary traits needed to remain consistent. For example, purpose, read the scenario below:

SCENARIO: After closing a few trades earlier, John realize that the trades would’ve hit his stop loss if they were not closed. Realizing that he avoid some losses, and even lessen some losses, he slowly started to invoke the practice of closing his trades manually in his strategy since it has yielded good results in the past of doing so. After a while he then realizes he is now closing quality trades that: 

-> Would’ve recover previous losses and more. 

-> Were in loss, seemingly heading toward his stop loss, but then eventually reverse and hit his take profit.

12. A forex trader does not trade without a stop loss.

To put it bluntly, trading without a stop loss is detrimental at the very least to say. Stop loss is a big part of forex risk management as well as a tool used to manage trades.

Unless planning on monitoring your trades for hours to days continuously, then every open position should have its respective stop loss in place. A Stop loss is use to prevent your forex or CFD trader account from losing an excessive portion of your trading balance from one bad trade.

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