The title ‘My First Ever Forex Christmas’ may well conjure up some lovely pictures in the mind of happy families, luxury gifts and a feast to remember, but alas for me it was a very different story!
My First 3 Month Forex Deadline.
When I’d started looking into forex I like many was looking at a 3 to 4 month time frame to crack this thing, I had a property project to finish, and although I wasn’t looking for vast amounts of capital that would make an impact on my property portfolio or something. I was just looking for another source of income while my property portfolio came to fruition to provide me with a decent pension. I’d learned that the Christmas period was very quiet for forex trading and this would be the ideal time for me to put a hold on everything I was doing, and give me a couple of good weeks to take in what I’d learned from forex trading so that I could start the New Year with a bang and off we go, situation sorted. The reality was very different, I think I was hooked on it by this point, and just couldn’t leave it alone, and go through the phase that most traders probably go through, which is just to stare at the charts waiting and looking and most of the time getting nowhere. What’s more is that you tend to place trades on for no reason at all, except that you’ve seen what’s on the chart in some system or other that you probably just can’t remember where. What can happen is that you’ve seen a MACD cross strategy, a stochastic cross system, some stuff using moving averages, not forgetting Fibonacci of course, and you enter at every signal you’ve seen on each of these trading plans, and probably each single one loses, or near enough. This happens because you have no coherent strategy, you are not looking at the forex market as a whole, most strategies are not effective just trading off of one timeframe, especially the smaller ones.
A Forex New Year.
Oh dear, by the New Year, things were looking as bleak as ever, my property business was floundering after the mortgage crisis, and I seem to be the brunt of every cock up, every mistake, every price fall, and just about everything that could go wrong did. It was clear to me that forex was not going to be my medium term income in the foreseeable future and would not provide me an income while I rode out the storm. All this did not add up to being conducive to learning forex, any outside pressure to earn money from forex does not help your learning, it is a sure way to let your emotions cloud your judgement. And it does not only cloud your judgement for the trades you place, it also clouds your learning judgement and your overall realistic aims of what you can achieve. I proceeded to consolidate my property project and keep concentrating on my forex trading, in that market there were no opportunities for new property projects, there was nothing available and if there was you probably could not finance it anyway. Over the next few months forex continued to frustrate me and a profitable week was the exception, I jumped from system to system, tried this tried that, convinced myself many times that I would be a profitable trader if I went live, and numerous times I did with very modest amounts of money. I did at least have the sense not to throw thousands and thousands of pounds into an account in the vain attempt that I would make a profit out of the blue. It took me a few more Christmases of grappling with forex to really start getting what it takes to make a profit, but over time I came to realise that it’s the psychology that is absolutely key to forex, it really is 80% of the equation. Simple things like, not entering a trade after 3pm GMT will prevent you making losses, and not making losses and preserving your trading capital must be your number one priority in the forex market. I’ve never really completely blown an account, but in practical terms many times it has, it has gone down to a totally insignificant amount of capital, and when you keep getting to this point, you can’t really trade or learn to trade effectively.