ADVANCE FOREX EDUCATION: PART FOUR: IT IS BETTER TO MISS A GOOD TRADE THAN TO TRADE A BAD ONE

THE GREAT COUNTDOWN BEGINS: " 7 LIVE TRADES" WITH "6 WINS"

ADVANCE FOREX EDUCATION: PART FOUR

IT IS BETTER TO MISS A GOOD TRADE THAN TO TRADE A BAD ONE:

 

One of the many factors responsible for the draw down in our accounts is the attitude of so many of us, forex traders, not wanting to miss out on any trade. Some traders even prepare a "balance sheet" in advance, on their trading accounts. They detail out how they intend to grow such accounts over some weeks, months or even some years as the case may be. They do not stop there, as they go on to indicate the exact percentage (%) profit on weekly, monthly or yearly basis which they expect to make over the period. Forex trading is not your farm where you can go to at the time of harvest, when it is time to do so. Including a "balance sheet" as part of your trade plan is very wrong. This is capable of creating undue tension in your psyche and you therefore become quite emotional, if not desperate to meet your target. I always warn forex traders against the idea of making budget before making the money to execute it. You must work hard first to make the money before making the budget on how to spend the money.

 

Forex trading is extremely speculative and you cannot sit in the comfort of your home or office and predict how much you are likely to make within a given period of time. Only forex scammers can promise you "heavens on earth" in order to dupe you of the little you have. If you box yourself into this “forex corner”, only God will help you, because you will become so desperate and gullible, thereby taking each and every trade you see as a potential access to reach your goals and you will be driven into making wrong decisions and taking bad steps, thereby culminating in taking bad trades.

 

You must be able to adopt a strategy and hold on to it at all times. If you subject it to periodic changes, it is not yet a strategy, it is still a prototype, a developing material for experimentation. Once it is adopted as a confirmed strategy, do not make changes to it.

If my trading strategy indicates a “ No Trade” it is a no trade for me, no matter what views others may hold about such a trade and I do not bother about the outcome or the price action afterwards. There is no time during the trading week when there will be no price actions or currency movements.This brings me to the topic for discussion:

 

 

IT IS BETTER TO MISS A GOOD TRADE THAN TO TRADE A BAD ONE:

 

It does not cost us anything at all to miss a good trade, because our accounts will not experience any debit of any kind, not even a commission to the broker will be charged for not trading. But in your desperation to have as many trades as possible, in order to meet up with your budget expectations, you end up taking unnecessary trades and having a lot of bad ones to increase the avoidable deficit in your account.

 

 Do not get your fingers burnt, due to your insensitivity to the risks and the speculative nature, of forex trading. If you miss a good trade, that does not make you a bad trader, in fact, it strengthens our resolve and determination to do better in due course. We must strive for perfection, although no one is perfect. Our attempt to attain perfection can be rewarded with excellence. As a perfectionist myself, I have no apology to give anybody for being one and above all, I am an incurable optimist, I always see the glass as half full, not as half empty, the way pessimists view it.

 

In addition, do not compromise any standards you have set for yourself. Stick to your plans, unless it is absolutely necessary to alter it, you must do so with cogent and verifiable reasons which you must document for record purposes and for confidence building too. You must believe in yourself before you expect others to believe in you. Let your confidence soar high and with your conviction, you can do the unimaginable. The forex market will always be there, no need for the rush to do the wrong things at the right time. Patience is a virtue and if you can explore and further exploit it, to the fullest, you will develop a good strategy that will be second to none. If any trade you take fails, a lot of known and unknown factors could be responsible, which I had discussed in the previous parts of Advance Forex Education. Do not allow anybody to suggest that a kind of "Support or Resistance Levels" could be responsible.

 

My intensive and very extensive research for five years have taken care of that. They are simply hypothesis and they are not useful. I delved into all those stuffs during my research work and much more. There is nothing anybody can tell me about forex that will be strange to me.

I deliberately used LIVE ACCOUNTS for my research work for the sake of confidence building because a Demo is always a Demo, not as viable as a live trading environment. This is the reason why forex brokers will rush new traders to demo-trade for a few days to declare them ready to trade away their hard earned money. Some will even say: Master the forex markets in 60 minutes,or even seconds, what an irony of life. A calculated attempt to mislead and misinform the public.

 

MISSING A GOOD TRADE IS NOT A FAILURE AT ALL:

 

If we all agree that it is better to miss a good trade than to trade a bad one, then, what do we say, if we missed 40 bad trades and had only one good trade in a month? Did I hear you say bad? of course not. It is excellent, fantastic, wonderful, fabulous and great. Look for more adjectives, to describe the outcome and whatever good adjective you use, is correct. That is so, because, your success in forex trading is not only measured by the number of good trades you are able to place alone, but by the number of bad trades you are able to avoid. If all forex traders can miss 99% of bad trades and trade 75% of good trades, there would be no forex brokers and liquidity providers to carry the burden and the risks of their capital outlay.

 

 

 Trading the news is beyond looking for a comfortable deviation or surprise, as my numerous “NO TRADE CALLS” have once again proven, that deviation and element of surprise alone, cannot successfully trade the markets. Do not plan to trade badly by shifting your focus from the strategy you have to the need to trade at all times.

 

I always position myself to see if there is an opportunity in any report I want to consider for trading. I do not wish it comes to be a good trade, I only wish I hold on to my strategy at all costs, without shifting attention from that. If it is a tradable report, fine and good but if not, fine and good. Good and bad trades will always come and go and the rate of your success depends on the side of the trade you lean on. Each time I have a NO TRADE call, I feel a sense of relief, because, these were the same bad trades that nearly ruined my chance to do a research work on forex trading. I always reflect on how we used to lose in the LIVE TRADE ROOM I subscribed to way back in 2007. If there was some level of guarantee that we could make at least 50 pips a month, I would not have left the LIVE TRADE ROOM. The monthly subscription was $300, and if I could trade a standard lot to make $500 a month from 50 pips, I would not have quit the LIVE TRADE ROOM. But it was absolutely difficult to make money there in the LIVE TRADE ROOM because the moderators did their best but their best was not good enough for me, so I left. They over relied on deviation or the element of surprise. For instance, when the US Non Farm Payrolls report has a deviation of 70k and above, we must trade to "make money". Most of the times, no so.I can now see clearly why they were not able to trade well, because they were doing the wrong things at the right time and sometimes, doing the wrong things at the wrong time. Having a deviation of 1.2% on US GDP, does not mean you can make money trading that report, it goes beyond that. A deviation of 0.8% on UK GDP can fail woefully if all factors are not in place and this is the reason, I am a strong advocate of : COMPREHENSIVE NEWS TRADING, THE ONLY WAY FORWARD, which embraces all the components of news trading.

 

Even, until recently, most of these bad trades made me to lose a substantial amount of money to many forex brokers. I would be very grateful, if a lot of you could avoid the pitfalls I emerged from, due principally, to my resilience in anything I do, because:

 

I DO NOT ADMIT FAILURE UNTIL I HAVE MADE MY LAST ATTEMPT AND I DO NOT MAKE MY LAST ATTEMPT UNTIL I HAVE SUCCEEDED. This is the “corner stone” of my resilience.

 

 I want you to adopt this same attitude and remain focused. It is quite better to miss a good trade than to trade a bad one and I want to expand it further:

 

 It is even healthier to miss some good trades than to trade some bad ones. STAY FOCUSED.

 

 

**** The countless number of money saving " NO TRADES" are handy and equally
healthy for our trading accounts.
For Your Forex Trading Breakthrough? Yes, You Can, and at NO COST at all.