I am to tell you more about psychology in forex - another key factor. A lot of traders think that psychology in trading is not as important as money-management or trading system, but the truth is that psychology is as important as other factors in trading. You should know that you are as a good trader as your weakest part, since I highly disagree with a claim that one factor is more important than others. The claim is misleading! You must be a master of money-management, psychology and trading system!

I personally distinguish 3 major elements in psychology:

Discipline

I really love to be a disciplined FX trader! I keep a trading diary with all my trades I made, and I think that every trader should keep his or her own trading diary, too. It is up to you how complex a diary you have. I have a complex diary with many details for myself. Then you should have a trading plan that tells you how to recognize a valid set-up, your entry, stop and profit level. Trading plan must be complex and yet simple. You should know your trading plan by heart.

All above-mentioned is discipline, however, I have to mention my very favorite strategy in order that you could be a disciplined trader without stress. It is a "Set it and forget it" strategy that I cannot omit. It pays that less is more in trading FX, so you should really not overcomplicate and overanalyze your trades, and just set them and forget them and let the market do the dirty job in your stead. That's it! Just set your entry, stop and profit level and then let the market decide if it will be a loser or winner. You must not change your stops or profit-targets, because then you are not a disciplined pro but rather an emotional fool. The only exception is a trailing-stop in a strongly trending market in which you can change your stops, nevertheless, it is a very advanced strategy for true pros. You should just aim for 1:2 RRR and set and forget.

Patience

Good things come to those who wait is an English proverb showing patience. All traders should know the proverb, because if you want to be a great trader, you have to be very, very, very patient. If you trade off of the dailies like me, you have about 1-4 high-quality set-ups per month, sometimes even none. Can you imagine that? Just wait on a trade all month or even two?! I can! Because I trade like a "sniper" and not a "machine gunner" that furiously shoots at everything that moves. Quality over quantity!

Confidence

Confidence in your trading system is very, very, very important. You must get rid of fundamentals and just focus on your charts and have faith in your trading system even if you have a streak of losing trades. No system is perfect! You must be consistent and do not change your trading system whenever you have a loosing line of trades.

Conclusion

I am a successful trader since I traded like a sniper and used a set and forget strategy. Then I started ignoring fundamentals and became even better. If you have confidence in price action trading system, you will not have to know all the fundamentals like the rate of unemployment, GDP, etc. Everything is already included in price!

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