There is an old saying that a journey of a thousand miles begins with a single step. This is also true of forex trading. Every trader wants to make big money, but trading just to make the most money turns investing into gambling. Successful traders should set goals that guide their trades. Not only do successful traders make goals, they make a series of targeted goals that are comprised of small achievable goals that lead to larger ends.
When sitting down to write goals for a trading plan it is tempting for a trader to only write down the biggest goals. Make a million dollars! Make a living day trading! Own a yacht! But these big dreams are reached only through reaching many baby steps. First you have to make enough money to buy a canoe and then you can earn enough money to buy a yacht. The most important aspect of setting goals is setting targeted, achievable goals. These goals should be start small. Think about what it takes to reach your overall goals. Do you want to have a 15% return rate on your investments? What does it take to get to 15%? Think of your goals like stepping stones. How do you step from one goal to the next? Targeted achievable goals give traders focus and lead to smarter trading.
Not only should traders choose goals that are achievable a trader should also consider all aspects of his or her trading system. Don’t just set goals around how much profit you would ideally like to have, but also how much loss you would find acceptable. These goals can also cover how much time you spend trading, how many trades you make, and even what computer you would like to use to make those trades. Goals should also cover your personal trading habits. For the self-employed trader being disciplined enough to sit down for a specific period of time every day is the first step to reaching profitability. It is not just about setting a goal of wanting to make enough money it is also about setting goals on how you are going to make that money. Take a class, read so many articles, create a trading plan, etc. By making goals that cover not just profits a trader can work on different aspects of what it takes to be a good trader. Buying low and selling high is the obvious way to make money but knowing how to do this is the real trick.
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