I want you to ask yourself the following forex trading questions and to answer them truthfully: As a trader, how patient would you say that you are? Do you panic sell your positions at the first sign of profit? Are you able to sustain draw-downs that you originally accounted for in your trading plan?
Here are two points that forex traders should consider around being patient and having the ability to milk the maximum amount of profit from their positions.
Give your Forex Trading Positions Time to Develop
You simply must give your forex trading positions time to develop if you’re going to be successful in the long term.
Every position that you enter should have a clearly defined entry and exit plan. What happens between those two points should NOT influence your position. If you got into a trade and it’s still within your risk parameters, then even though it might be experience a slight drawdown, you’re still not incorrect so you should be holding and letting the position develop. Only when your position hits your pre-defined stop loss are you then wrong and you should be getting out.
Not giving your forex trading position time to develop is one of the single biggest reasons that new traders end up taking loss after loss. This comes down to patience and having the ability to sit on your hands and trust in your own process.
Know When to Close your Forex Trading Positions
The second point that I wanted to go over in this blog about being patient in your forex trading, is that of knowing when to get out. That is both in profit or taking a loss.
You might laugh at this point, but by closing winning positions, you are doing yourself more long term harm than good. Letting winning positions ride and adding into them with low risk add ons, is key to being successful long term. Knowing when you
But it’s the type of loss that you’re taking that is important. Did you allow your position to fully develop and give it every chance for your original forex trading call to be correct? If you didn’t, then you’ll soon see that by consistently closing your trades outside of your plan, you’ll more than likely lose money overall. You’ve done the risk management planning and your forex trading system has clearly defined risk management parameters that need to be followed in order for it to be profitable.
I hope that you can take away some points around becoming a more patient forex trader and that it will give you some ideas to consider in your own development. To truly succeed in the forex trading game, you have to be always willing to adapt as a person and to expand your trading strategy. Developing your patience around these factors will be a key driver heading forward.
Source: Vantage FX Blog