Just What Goes Into Making a Successful Forex Trader?

By: Donald Saunders

If you were to split foreign currency traders into two groups ï?? those who are successful and those who are less than successful ï?? could you pick out those characteristics which differentiate one group from the other?

It does not really matter what we do in life, which includes foreign currency trading, but, no matter what we do, one thing that will have a more significant affect on our success than anything else will be goal setting.

It is a simple fact that the human mind works best when it is given a roadmap to follow and, by setting yourself a goal, you start building your roadmap by clearly defining the destination for your journey. However fixing a destination is not enough and you will also have to define the route to follow to get to your destination. Let us consider an example.

Suppose that you make up your mind to build a fortune as a foreign currency trader, and who doesn't want to after all! This is not however very helpful as any goal that you set yourself needs to be measurable, otherwise you will have no way of knowing whether you have reached it. So, at this stage, you have to be clear about exactly what you mean when you talk about a 'fortune'.

Let us assume therefore that you decide to set yourself a goal of making $1,000,000 in the next year. You now have a clearly defined destination. The next problem however is that, since you are probably new to the world of foreign currency trading, are still trying to learn the ropes and probably have only limited money to invest at this point, realizing $1,000,000 in the next year is possibly not that realistic a goal.

In addition to being measurable, goals also have to be realistic. It is immaterial what goal you set yourself in foreign currency trading, but it has to be within your capabilities. There is no point in saying that you are going to win Wimbledon if you have never even held a tennis racket.

So, instead of aiming for $1,000,000 let us look at setting a far more realistic target of say $120,000. Having done this, we then have to break this figure down into marker posts which we can add to our roadmap and we can do this by looking at our target on a monthly as opposed to an annual basis. This will give us twelve $10,000 markers. Now, if we continue along these lines we can then break our goal down further into weekly markers of $2,500.

At this point we have got something that we are able to view against our current experience and it is a fairly simple matter to see whether or not this figure is attainable. Is it possible, against the background of your current experience, to make $2,500 trading Forex in the coming week?

Your goals have to be measurable and realistic, but they must also be attainable. It is all very well to set yourself a realistic goal, but you also need to have the right tools, in the right place at the right time to reach that goal. If you are currently making $750 a week then you probably won't turn this into $2,500 overnight so, in this case, your goal is not attainable and you will have to go back to square one and start over again.

But, if we assume that $2,500 is attainable, then there is one additional step that you need to take before you are ready to head off on your journey. This final step is to paint a picture in your mind's eye of your destination.

Although you have set yourself a goal of making $120,000 in the next year, the money by itself is not really what you are aiming for, but it is what you can spend that money on that is important. So, having made your $120,000 what are you going to do with it? If you intend to buy yourself a new SUV then paint yourself a picture in your mind's eye of driving into the sunset with the roof down and now you really have got a goal.

If you want to be successful in foreign currency trading then you must set yourself a goal that is measurable, realistic and attainable and paint a picture of that goal in your mind's eye. If you do this you will be amazed at how simple it is to get to your destination.

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