Before you even got familiar with Forex trading, you probably heard about it from a friend, a family member, a T.V commercial or through the internet.
At first, it sounded like a legitimate way of earning lots of money in a short time. Images of dollar bills kept flashing in your mind, accompanied by the imagination of a traders’ lifestyle. This Canadian dude has been deceiving new Forex traders using flashy lifestyle that is supposedly associated with Forex trading. But this is not the topic for this post.
Anyway, you couldn’t wait to learn every small lesson that there was to learn in trading. You couldn’t wait to get the best Forex expert advisor that would allow you to pile up the money while you sleep at night.
Are you there yet? I bet not. Most of you will say that even though there was some element of excited the first time you heard about Forex trading as a beginner, you still do not know how to trade and actually make money.
You have probably practiced for 1 or 2 years, read every book that has been published about trading, attended trading seminars and bought numerous home study courses, believing that you will eventually learn the ”secret”.
At some point, your demo trading results were good. You were winning most of the trades. But once you switched to a live account, you lost 50% of your balance in just two weeks.
You decided to go back to the drawing board because you figured that your trading methodology wasn’t working. You think to yourself that you must have been lucky to make profits with this particular strategy for a significantly long time. That is why it is no longer working with a live Forex account.
Many traders can identify themselves with this scenario. In fact, there is no Forex trader who has never blown up their account at least once.
Sometimes the markets can look like they are rigged. I have come across some people hinting on the internet that the Forex market is often rigged, which is why you can’t get consistent results over the long run.
In fact, there is a thread on Quora which is solely dedicated to this discussion.
Another article here addresses this issue from a perspective that may change your mind once you read it.
Regardless, it always seem easy to demo trade and make money. But the moment you enter this market with real money, tables suddenly change, and you begin to lose most trades compared to those you’re winning.
I know exactly how this feels because I have been there. It is part of a Forex trader’s journey to master how to trade properly. Most give up while some don’t seem to learn from their mistakes, and so they keep losing more money in the process.
And then there are a few traders who opt to push to the other side of the coin, through blood and sweat. They are in the famous 5% successful retail traders.
But does this mean that you can never join the 5% of successful traders in the world? Not at all. I believe that the Forex market has an equal chance for all to make money fairly and squarely.
If you’re trading with a good broker and are using a trading product that has been shown to be consistent in generating returns, there is no reason why you should fail in the long run.
This post basically discussed why Forex traders lose lose money and how they can stop blowing up their trading accounts once and for all.
Role of a Forex expert advisor:
Get yourself a good automated trading system
You see, I always say that trading requires discipline, dedication, goal-setting, logic and patience. If you thought that it’s a get rich quick scheme, you are damn wrong.
Unfortunately, most traders have proved that cultivating these characteristics into their trading lives is somehow not possible. This is driven by human greed, which prevents us from staying dedicated to a particular trading strategy because we want quick money now.
Any market formation that looks like a trade setup is often treated like an opportunity to make money. It only takes discipline and patience to learn that the markets can sometimes trick you, and that what you might be seeing on the chart is not exactly what is happening.
For that reason, I always advice my readers to get themselves a good, reliable expert advisor that has been proven to work. And the keyword here is ”reliable”. It simply means that most Forex EA’s in the market will make a profit today and blow up your account tomorrow.
They are simply not consistent. But you see, the ability of a trading product to lose more trades than it wins is a good confirmation that the vendor is not proficient in trading.
For you to create an expert advisor that actually works, you must first possess the characteristics that I mentioned above: discipline, dedication, goal-setting, logic and patience.
As a programmer or someone working with a programmer, you can hard-wire these characteristics into the algorithm to come up with an expert advisor that follows the characteristics of a successful human trader.
From there on, this software can be used to trade. And believe me or not, the results for your trading will always be the same regardless of whether you’re demo trading or trading in a live account.
Right now, there are lots of options for trading Forex. Even newbies who know nothing about candlesticks can jump in to start trading as soon as they finish reading this post.
But unless you understand that the best trading system is created by someone who possesses the above characteristics, you will never become a successful Forex trader.
If you’re new to this, don’t go learning complicated things like Elliot Waves, Stochastics, MACD’s or something along those lines. You will get confused. Unless you’re aspiring to become a manual trader who enjoys spending their time glued on their computer screens, I don’t encourage you to go this direction.
I will save you by concluding that you should be realistic and understand that Forex trading, for both newbie and seasoned trader is a journey. If you want to become a successful trader, check out my trading products guide here. Then make a decision from there. Otherwise, you might just end up falling by the wayside like most of us do.