Luck vs Skill In Forex Trading
In today forex faq, we have a question from one of our readers telling me that he has lost $1,300 in trading and have not yet withdraw a single dollar from trading.
Below is the question:
I am trading almost one year and I lost more than $1300 and not yet withdraw one $. Is it due to my bad luck or I am not good trader
Trust me, luck plays a minor part in trading only. It is the strategy and your discipline to stick to the strategy that plays a major part in trading.
Personally, I feel that the main reason you did not make a single $ from trading is because you are trading without a reliable strategy. In fact, you are not the only victim as most of the new traders in the market are trading without a reliable strategy.
This is exactly why most new traders lost money in trading forex.
The only way you can recoup back your losses and start to withdraw money from your account is to learn a reliable strategy from anyone you trust.
A good strategy must have
– High risk reward ratio
– High Winning percentage
– Easy to execute
Please do not use those strategies that you learn from youtube as most of them are general strategies that have not been fine tune yet.
I have received emails from readers telling me how much they have lost using those strategies that they have learned on youtube. In fact, most of the videos there are created by marketers and this should explain why you are losing money using them.
No matter what strategy you learn and from who, you guys must always make it a habit to test it on a demo account for sometime before you go live. The demo account is one of the best way for a trader to test out a strategy.
First, you can do a back testing on the strategy for at least 3 months and then do a live testing on the strategy for another 2 months and you will know how effective the strategy is.
Back testing means that you just have to pull the chart back several months and then slowly go through the chart to see the entry and the outcome. You will then need to record it down.
After that, you will do a live testing which means that you will trade the strategy on the demo itself to see the effectiveness. Once the strategy manage to produce profits for most of the months or for me, it has to be every month, I will then trade it live on a live account.
I hope that I have answered your question and do feel free to email me if you have further question.