Forex trading is amazing! It provides a way to work from home, earn a significant income and to be your own boss. It is also exciting and can get your adrenaline pumping. For some people, like me, it is a dream job and career.
Unfortunately, most traders don't make it. They spend years trying to make money from the markets and never achieve the success or status they hoped for. For most traders, hope and ambition is replaced with discouragement, frustration and disappointment.
I personally believe that more retail traders would be profitable if they took the time to learn from someone who is already successful i.e have a mentor. In this post, I will share the advantages of having a Forex mentor and teach why you should seriously consider having one, no matter your trading experience...
Forex Mentors - the good, the bad and the ugly
The Forex trading industry is full of companies and individuals providing services for traders and wannabe traders. Some of these services are great and reliable, some of simply scams, just like all industries and sectors, Forex is no different. When it comes to mentoring, what should you expect and how can you get a honest mentor that is going to be a master teacher and super asset? Read on...
What to look for in a Forex mentor
Results. The most critical question to ask when choosing a mentor is, 'is this mentor a profitable Forex trader?'. It is not enough for a potential mentor to upload a live trading video to YouTube, copy and paste screenshots of trading history to a website or share a photo of a Lamborghini on Instagram. A real Forex trader can provide real results. The easiest way for them to do this is to link their trading account(s) to a 3rd party that can publicly verify trading performance. Forex Factory and myfxbook are 2 sites that do this at no cost or risk to the mentor/trader/educator.
Transparency. Apart from seeing publicly verified results, do some personal research. Does the educator have any online reviews? Has the educator been featured on any well-established websites? How long has the educator been trading for?
Payment. Any genuine trader will have a genuine and well-known payment provider such as Stripe, PayPal, WorldPay, Square, etc. Never transfer payment directly to a bank account.
Other things to consider
Location. Where is the trading mentor based? This may not be an essential item on your list but ensuring that your local time and the potential mentors local time are compatible can be useful. If you are only free late-evening but your late-evening is midnight for your mentor this may cause some problems. I suggest you send them an email and ask before signing-up.
Program Outcome. What is the goal of the mentor program? If your goal is to become a successful trader but the educator offers a program to teach the basics of trading and get you started, then you are going to be very disappointed...
Samuel Morton (me), as your mentor
Results. My trading accounts are publicly verified by myfxbook. They are available on my trading performance page and also on myfxbook.
Transparency. I have been trading since 2012. I have online reviews on my Facebook page and a number of testimonials on my testimonial page. I am employed as a technical analyst for a regulated Forex broker and have been featured across the web, including on IG TV.
Payment. All payments are processed through PayPal (PayPal account is not required). Bank transfers are available at your own risk.
Location. I am based in the UK. I prefer to provide mentor sessions between 1900-2200 UK time but can be flexible. I am usually free between 1000-2200 UK time.
Program. The aim of my program is to make you a self-reliant and profitable trader, nothing less.
More details about my Forex mentor program can be found on my mentor page.
Got questions? Email me; firstname.lastname@example.org
Forex mentors usually offer a set program for a fixed price. Prices and programs can vary but below is some key advice...
What should they include?
Mentor programs usually consist of a series of workshops done in a group or a series of training sessions provided one-to-one. These workshops and sessions can be done online or in person.
Having access to your mentor between sessions is important and being able to ask your mentor questions is vital. Any pre-recorded material or free workshops is not going to be as beneficial as speaking with a real-life trader.
Why sign-up for a mentor program?
The ultimate way to learn anything is to learn from someone that can already do the thing you want to do. Books and courses are great resources for education and growth but nothing compares to having someone to personally lead and guide you.
Forex trading is not easy, over 90% of traders fail. To greatly improve your chances of success, you need a Forex mentor. A mentor can help you avoid costly mistakes, decrease the time it takes to become profitable and increase your success rate. Some traders will not become profitable until they have a mentor, coach or teacher.
A good mentor will tailor training to your needs, provide support and motivation and have your trading welfare as a priority. All these things are crucial keys to successful trading.
My mentor program
My program includes 6 online training sessions with me, unlimited email support between sessions and access to my exclusive price action trading course. All training sessions are tailored to the student.
- Tailored for your needs
- 6 online training sessions
- Unlimited email support
- Access to my exclusive course
I don't need a mentor, I am going to be self-taught!
Some successful traders are self-taught, but most are not. Even those that are self-taught admit that they would have saved money and time by having a personal teacher/mentor. Being self-taught is a great goal but it should not become a higher priority than becoming profitable!
Mentor programs are too expensive
Some mentor programs are not cheap, I totally understand this. What I don't understand is the trader that has blown £2,000+ on multiple trading accounts but will not pay out for proper trading education! In most cases, mentor programs pay for themselves as they save you costly errors. If you don't get a mentor, you will likely lose the cost of the mentor program in over-trading, becoming emotional in your trading, poor analysis and/or foolish errors.
Education is an investment of time and money. If a program helps you to become a profitable trader, surely it was worth every penny...
This guy is not a genuine trader
An understandable concern. Please refer to my content below the heading 'What to look for in a Forex Mentor'. If the trader/educator ticks the boxes, just go for it.
I can't commit to taking the step
If you cannot take the leap of faith to hire a mentor, how will you ever take the leap to trade full-time and become a successful trader?
If you want to become a successful trader, learning from a profitable trader is your best option by far. Just do some research and follow the advice in this blog before signing-up to any mentor program.
So, you want to become a Forex trader? Many people are attracted to Forex due to the persona and hype around making money, working when you want and doing something that is exciting and lucrative. The reality can be very different from what most expect though... As a full-time Forex trader, let me give you an insight into the life of a real Forex trading...
Not all is what it may seem
Forex trading is exciting... Or is it?
Most people will have a mix of excitement and nervousness when they first start trading. This emotion concoction will have adrenaline pumping through your veins, but this is nothing when compared to the rush of winning big or significantly increasing your account size. Unfortunately, winning big is not something that happens often for most traders. To be honest, most traders experience the initial adrenaline rush when they first start trading Forex but they soon have these positive feelings replaced by frustration, disappointment and discouragement...
The fact is, most traders fail. Forex trading is not exciting if you are on the losing team! Losing money over and over again is not fun and is damn-right frustrating. For some, they will lose life savings - how soul-destroying and irresponsible!
So, what can you do to keep Forex trading enjoyable and exciting?...
1. Never trade with more than you are willing to lose. Any cash in a trading account should be cash you are willing to let go - have the mindset that it is already lost and that you will not be getting it back.
2. Keep trading as a hobby until it is obvious that you have talent or acquired enough skill to take trading more seriously.
3. Educate yourself about risk and money management, strict risk management will keep trading steady and fun rather than emotionally devastating.
I will let you in on a little secret... Once you are a profitable trader, Forex no longer becomes about excitement. I have been trading for several years now, I wouldn't say that my daily life as a trader is exciting. Don't get me wrong though, I still have a rush when I make a fantastic trade or see a new strategy working but most of the time trading can be a bit tedious. With time, Forex trading becomes more about discipline and consistency rather than something that is emotionally rewarding. If you are having a daily emotional roller coaster, then you are likely doing something wrong.
Forex trading makes you rich... Or does it?
Forex traders are rich! They drive Lamborghini's and trade while sun-bathing in the Caribbean... If only this were true, my daily life would be a lot of fun!
Trading has made me wealthier than I ever imagined I would be but it does not provide a lavish life full of riches (especially when you have 4 kids, a wife and live near London!). Trading will make you rich but it is not a get rich quick scheme. Trading takes time and patience. You can see from my verified trading results that I gain anywhere from 20-100% per year on each of my accounts, depending on the trading strategy. Being profitable for a year will not change your net worth much but being profitable for 5 years plus may have a significant impact. Below is an example of someone starting with a small trading account and making a half-decent return each year. This could be someone that is working or a student, someone that is trading part-time as a money making hobby.
Starting Capital $5,000
Year 1, 43% return = $7,150
Year 2, 29% return = $9,224
Year 3, 63% return = $15,034
Year 4, 91% return = $28,716
Year 5, 32% return = $37,904
Year 6, 87% return = $70,881
Year 7, 49% return = $105,613
Year 8, 14% return = $120,399
Year 9, 77% return = $213,106
Year 10, 71% return = $364,412
The above is not meant to discourage you but to give you a better perspective and a more realistic expectation. If you really wanted to push the boat out and trade like my verified combined account - trading a number of strategies from a single account and increasing risk - you could see something like the following...
Starting Capital $5,000
Year 1, 143% return = $12,150
Year 2, 129% return = $27,824
Year 3, 163% return = $73,176
Year 4, 191% return = $212,942
Year 5, 132% return = $494,024
Year 6, 187% return = $1,417,850
Year 7, 149% return = $3,530,447
Year 8, 114% return = $7,555,157
Year 9, 177% return = $20,927,785
Year 10, 171% return = $56,714,298!
In short, Forex can provide financial freedom but we are talking about years rather than days, weeks or months... I should know, I have been trading for over 7 years now!
You can see my verified trading performance and returns on myfxbook - click here!
Forex trading allows you to be your own boss... Or does it?
Yes it does. I get to work from home, I am pretty flexible with my day and I work in my pyjamas. However, I rely on the market. There are certain hours I have to trade and there are certain times I cannot leave my desk. I also have to keep trading in order to make money. Trading whilst on the beach or having total freedom with time is not realistic, I need my desk and computer setup to trade. I can manage some trades from my phone while on the go but that is it, I need to be in the office for analysis and entry. Taking days off can result in missing profitable trades, sometimes the best trades of the month!
Saying all this, I don't have to work much and love what I do. I have not taken a sick day in the last 7 years, that should tell you how much I love this job. As a Forex trader you will have it far better than most but you may not have as much freedom as you may have thought.
So, what's it like being a full-time trader?
My daily routine differs from most traders as I also run a Forex trading room, work as a technical analyst for a FX broker and have my website and other business projects that I work on. Perhaps my routine will provide some insight into the daily life of a Forex trader though...
0500 - Wake-up and commute to the office i.e open 2 doors and sit at my desk
0515-0600 - Check any open positions, emails and news
0600-0700 - Prepare my charts for the day and update my trading room
0700-0800 - Provide analysis for TriumphFX
0800-0900 - Shower, breakfast, take the kids to school
0900-1200 - love-the-pips, emails, other projects
1200-1300 - lunch
1300-1500 - love-the-pips, emails, other projects
Every hour I check my charts for about 10 minutes. I open positions, manage current positions and close positions down. I do this every hour on the hour from 0600 to 1800.
If I solely traded, I probably would work an hour preparing for the day and then 10 minutes every hour as above. I would likely only have to work about an accumulation of 2-3 hours a day. My other commitments keep me busy the whole day though.
The sky's the limit! It's all about how profitable your strategy is, how much capital you have and how much you are willing to risk per trade. You can earn a lot of money but you generally need a lot of money to make a lot of money - trading is a game for the rich to get richer.
I get a "pay rise" each year (not many jobs offer that) - as my personal accounts grow, I am earning more and more.
How much you want to earn is really down to you. The key is to start small and increase your account and risk with time and experience. Once you can make a consistent return with a $100 account, increase this to $500, then $1,000, and so on...
A good trader can be earning around $100,000+ within 5 years of good performance, depending on commitment, starting capital, and risk.
Forex trading is very satisfying but can also be frustrating and discouraging. Ending the month with a profit is a great feeling but it will not leave you ecstatic as you will have to risk that money again the following month! I don't mean to be negative, I am rarely negative. I am just trying to be honest.
Being able to withdraw a large sum of profits once a year is fantastic.
Pride - there is a great sense of personal pride and self-achievement when you are in the 10% that can actually make money from trading.
Loneliness - trading can be lonely at times. It's not just the working by yourself, it's also that not many people understand or are interested in what you do for a living. Trading forums and social sites can help with this.
Keep active - sitting at a desk most of the day is not fun. Going for a run will not just make you feel better about yourself, it will also clear you mind after a losing streak and give you a healthier mindset.
Struggling to make money with Forex? Check-out my one-to-one Forex mentor program
Want to learn my trading strategies? Take my Exclusive Forex Trading Course.
The Forex markets are continually moving. This provides great opportunities to make money but also opportunities to lose money. With leverage, low margin requirements and a lack of risk and money management, a trader can potentially lose a lot of money when trading Forex.
I have received countless emails from people who have blown accounts and have lost savings trying to trade Forex. Trading is a game, a risky game. This does not mean that trading cannot be consistent and worthwhile - take a look at my Forex trading results, I make money pretty much every month of the year - it just means that you need to be well-versed in risk and money management to ensure success. This quick guide to risk management when trading will ensure that you are not taking any unnecessary risk.
How to be successful in Forex
To win the game of trading, you need to focus on the following areas...
1. Have a profitable trading strategy, plan or system
2. Minimise trading emotion and trading psychology
3. Reduce and manage risk
In this post, I will be focusing on point 3 - reducing and managing risk - but to be honest, all 3 areas of focus are so intertwined that it is hard to talk about 1 of the above points without mentioning the others.
Your Guide to Reducing Trading Risk
Tip #1 - Have a trading strategy
Believe or not, one of the best ways to reduce risk when trading Forex is to have a trading strategy... Why? Without a trading strategy you have no trading edge and are simply gambling. A strong Forex trading strategy includes detailed entry and exit points, why and when to open and close trades and details of past performance. Past performance, what an essential thing this is! Historical results will show the win rate and past draw-downs of the strategy. If you don't know these things, you have no tangible evidence of how much you expect to lose and how often you should expect trades to provide a profit. You are simply trading blind.
On another note, a well-planned trading strategy helps to reduce trading emotion. No longer will you be relying on discretion (i.e emotion) to trade but you will be more "mechanical", systematic and following a well-thought-out plan. Relying on discretion or emotion will lead to unsuccessful trading.
I did tell you that all 3 of my areas are focus are intertwined, improving 1 area actually improves all 3.
If you would like to learn my Forex trading strategies, you can do so in my Advanced Price Action Trading Course.
Tip #2 - Position sizing
Even with a holy grail trading strategy, you can still lose money if you are risking too much. Do you know how many traders have blown at least 1 trading account?! I would estimate at least 70% of retail traders have done this. Most of the time this is due to traders risking far too much per trade.
Sensible position sizing allows a trader to take a series of losing trades but still have sufficient capital to continue to trade. Sensible position sizing also reduces trading emotion and psychology. The more you are risking per trade, the more emotionally attached you will become to that trade. Successful traders risk little when it comes to position sizing. I suggest the following...
Position trading - 2-3% per trade
Swing trading - 1-2% per trade
Day trading - 0.25-1% per trade
If you disagree and feel that you should be risking more, ask yourself 'why am I risking so much per trade?'. The answer is usually desperation or impatience. Both emotions are not healthy and will not make you successful. Profitable trading is about consistency and discipline, not about desperate trades and taking unnecessary risk.
If you need help to calculate your position each trade, I suggest you watch this video and also use this pip calculator.
Tip #3 - Leverage
Leverage is great! I love trading with leverage. Some people warn against leverage though, they are right to do so. Leverage enables a trader to open large positions with a small amount of capital, making it possible to have big returns but also big losses. When trading with leverage the key is sensible position sizing and holding a minimal amount of positions. A trader using high leverage has the ability to potentially blow 90% of his or her account in a single trade or hold 20-30 positions and get a margin call.
The key to reducing risk with leverage is to ensure that your position sizing remains small and consistent and that you don't over-trade.
Tip #4 - News Events
Nothing moves the markets more than news events. I have seen 100 pip+ moves in less than a second when unexpected news is released. Being on the right side of these moves is euphoric, being on the wrong side and receiving slippage on your stop-loss is devastating.
The news events that usually cause the most movement in the Forex markets are...
Political events - such as trade, elections, and referendums
Central bank announcements - such as rate announcements and statements
Economic figures - such as employment change, unemployment rate, CPI, GDP, NFP and trade balance
To help you trade around scheduled economic figures and rate announcements, I suggest using an economic calendar.
To help you be aware of political events, I suggest you use a news provider, like BBC news, and other sources like Bloomberg.
Tip #5 - Emotions
Allowing yourself to become emotional in your trading is a great way to increase trading risk. Revenge trading, doubling-up and letting losing trades run have to be a no-no.
To reduce trading emotion and in turn reduce trading risk, I strongly suggest the following...
1. Have a profitable trading strategy with clear entry and exit rules.
2. Ensure that strict position sizing is adhered to.
3. Only fund a trading account with what you are willing to lose. Life-savings and debt are not options when it comes to funding an account.
4. Change your trading expectations. Focus on making a profit this year, rather than today or this week. Don't expect every trade to be a winner. Accept the lose before it has already happened..
If you want to learn more about minimising trading emotions, I suggest you watch this video.
Tip #6 - Brokers
Having a bad broker is another way that trading can become more risky. Some "brokers" are fake and are after your hard earned cash. Depositing with these brokers will result in you never seen your money again. Brokers offering a poor service will frustrate you (making trading more emotional), they are renowned for closing positions without a stop being triggered and having platform connection issues. If you cannot access your trading account and big news is approaching, what can you do?! I had a friend that opened a large position without a stop-loss. The brokers server then went down and he could not access the trading platform to place a stop or close the position down. The result, a huge loss of £10,000. It was his own fault for risking too much but this loss could have been prevented if the broker was more reliable.
It is also advisable that you spread your trading capital across a number of different Forex brokers or at least deposit a minimum with the broker of your choice. If your broker goes bust, your funds will likely be gone or frozen until the administrators have done their job.
I highly suggest you only open trading accounts with Forex brokers that are well-regulated (FCA, ASIC or NFA) and have a strong global presence. I personally suggest you trade with Darwinex and IC Markets. Both are well-regulated brokers that I personally use and trust.
I have a great guide that you should read when choosing a Forex broker, you can read the guide here.
In summary, use your common sense, don't be emotional and treat your capital like a good friend.
Forex Brokers... An introduction to a common Forex traders headache...
Forex trading has it's ups and downs. When you are winning, Forex trading feels euphoric. When you are losing, you are eager for the next winning streak. When your Forex broker stops you out for no apparent reason or has technical issues, trading can become frustrating.
To be honest, I have not had Forex broker issues for years. I feel that this is mainly due to the fact that I know what I am looking for when opening an account with a Forex broker - I have had my period of trial and error.
I often receive emails from people who have opened Forex trading accounts with Forex brokers that I have never heard of and that are based somewhere fairly exotic. These emails usually go something like this...
'Have you heard of [insert broker name]? I opened an account with them and deposited [insert amount of money] and now I cannot access my account or withdraw my funds. Their customer service team are not responding to my emails... I think I have been scammed'.
After I read an email like this, I often feel sorry for the scammed individual. I do often think to myself though 'what were you thinking?!'.
You should never give money away so easily. You should do some research before using the services of any company . You should not trade live until you are profitable trading demo - always open a demo trading account first. Once you can make a consistent return trading Forex on a demo account, then go live.
Only trade using a Forex broker that is registered and well-regulated by a recognised financial body/regulator. When I have checked the websites of scammer and fake Forex brokers that are withholding client funds, there is often no detail about regulation. If there are details about regulation, the Forex broker is usually regulated somewhere exotic that is not a recognised financial centre. I suggest that you only trade with Forex brokers that are registered and regulated in the UK, the US, Australia and Cyprus.
Forex Brokers - The Bad
Some brokers are well-regulated but still offer a negative trading experience. These Forex brokers are those that are generally market makers. This does not mean that all market maker brokers are bad and not worth using, but from my experience this is generally the case.
Why do Forex market maker brokers offer such a bad trading experience? I believe this is usually down to the spreads. Market maker brokers (spread betting brokers and CFD brokers) may boast that they offer commission-free Forex trading but spreads are usually very wide and extremely variable. During news events, I have seen 3-4 pip spreads widen to 30-50 pips, even with the most popular spread betting and CFD Forex brokers. This results in terrible entry prices, orders not triggered and stop-losses unexpectedly triggered.
When choosing a Forex broker, some traders take into consideration the platform(s) supported by the broker. With free chart analysis websites like TradingView and so many brokers now offering free unlimited demo accounts, the trading platform(s) offered by a Forex broker should not be a priority when deciding your Forex broker. Nowadays, you can use a Forex broker for execution only and find a third-party website or free trading account elsewhere for chart analysis - having a Forex broker that offers a great platform for analysis is no longer needed.
Forex Brokers - The Good
So, what do I consider a good Forex broker? For me, it is a broker that I can trust with my funds, who will execute my trades as expected and provide tight spreads, even when markets are volatile due to high impact news events. The Forex brokers that meet my personal criteria are often STP and ECN brokers. It is true that these brokers charge a commission per trade but spreads are extremely tight - sometimes 0 pips on major pairs - and overnight/swap fees are minuet (quite often they are positive - meaning you are paid to hold positions overnight).
The 2 brokers I have been personally trading with the last couple of years have been Darwinex and IC Markets. I don't have a complaint about either broker. Below are some details that you may find useful...
Forex Trading - High hopes followed by deep feelings of failure...
I have been in the Forex trading industry since 2012. I have met so many people enter the Forex trading industry with high expectations; financial freedom, working from home, doing something they love, etc. I would say that 99% of those I have met never fulfilled their Forex trading dreams and gave-up on their Forex trading ambitions.
Most retail Forex traders can relate to feelings of discouragement and disappointment and have blown at least one Forex trading account. Why does this happen and why is it so common for Forex traders to lose?
Why I believe so many Forex traders fail...
The most common characteristic that I have seen amongst unprofitable Forex traders is false expectation. Let me tell you some truths about Forex trading...
1. You will not be a profitable Forex trader within a few weeks or within a few months. I suggest you have a goal of becoming profitable set at a few years. Yes, a few years! Obviously the road to successful Forex trading can be shortened if you learn from someone who is already a successful Forex trader but successful Forex trading takes time - just like most things in life.
2. You will unlikely to make triple-digit returns and grow a small trading account to a professional trading portfolio in a short space of time. For example, it is very unlikely that you will turn a $500 Forex trading account to $50,000 within a few months or within a year. I recently opened a new trading account with the goal to make at least 10% per month (you can follow this account at Forex Factory and myfxbook). I have been trading Forex for several years though - newer Forex traders should expect a smaller return.
3. Once you are a profitable Forex trader, trading no longer provides an adrenaline rush that requires your absolute time and attention. Trading becomes more of a relaxed office job. Of course there is still excitement when you have a fantastic trade but this may not be a daily, or even weekly, occurrence.
I don't mean to come across negatively. The purpose of my words is to help you lower your expectations in order to have a much more realistic view of what profitable Forex trading is and what becoming a Forex trader can provide. I love trading Forex and would do nothing else. I have the ability to work from home and earn a fantastic income but it was not an easy journey. I don't own a Lamborghini and I don't spend most of my time on holiday - I have to trade to pay the bills!
Why does expectation determine Forex trading success?
So, how does unrealistic expectation lead to Forex trading failure? A Forex trader with unrealistic expectations is never satisfied with his or her Forex trading strategy, his or her Forex trading results, his or her Forex trading mentor and so on... I recently uploaded the following quote to my Instagram, which suits this post nicely...
"I feel that too many rookie traders put too much pressure on themselves - if they don't win big today, this week or this month, they feel like they are failing. Trading successfully is not about winning big or doubling your account balance every few weeks. Successful trading is about doing something you love whilst making a consistent return.
Do you know what percentage return the most successful hedge fund gained last year? Most of you are trying to beat hedge fund performance 5 times over... Have a long-term perspective. Trading will only make you rich once you can make a consistent return, you have experience, and are confident in what you are doing. This cannot be achieved within a few months"
- Samuel Morton
When a Forex trader becomes unhappy with his or her Forex trading performance, they ditch their current trading style, trading strategy or trading mentor. They then find a new one. Guess what? The same thing happens again... and again... and again...Unrealistic expectation is at the heart of Forex trading failure and is the fuel of the never-ending cycle of Forex trading failure...
1. Create or learn a new trading strategy
2. Trade the strategy
3. Hit a draw-down
4. Give-up due to unrealistic expectation
5. Create or learn a new trading strategy, and so on...
How about Forex trading psychology?
Yes, the challenges of Forex trading psychology and a lack of emotional discipline are to blame for failure too but trading psychology routes from unrealistic expectations. Let me give you an example...
Jimmy has developed a Forex trading strategy that is going to make him rich
Jimmy has back-tested the strategy and even tried trading the strategy on a demo account
Jimmy has recorded that the trading strategy has a win-rate of around 70%
Jimmy places his first live trade. It's a small win. Great, roll in the money baby!
Jimmy places his second live trade. It's a loser. Now in a slight loss.
Jimmy places his third live trade. It's a loser. Starting to get frustrated.
Jimmy places his fourth live trade. It's another loser. There must be something wrong with the strategy?! Jimmy gets frustrated as once again he has hit another losing streak.
Jimmy gives-up and orders a large pizza, which he eats all to himself while crying to some uninspiring show on TV.
What has happened in this story? The obvious answer is that Jimmy has become victim of Forex trading psychology. Let's look a little deeper though. Let's consider a different question, why has Jimmy become a victim of Forex trading psychology? It is because of his unrealistic expectations. For some reason, Jimmy did not expect that he would have a losing streak, especially so quickly. Even with a 70% win rate a Forex trader is going to experience losing streaks, losing days, losing weeks and even losing months. Jimmy had not accepted this though and thought that his road to pip mountain would be plain-sailing with his super new Forex trading strategy.
Change your mindset
It is time for me to finish this post as other trading and non-trading demands are calling. I think the following quotes may help to conclude this post well...
"If you change the way you look at things, the things you look at change"
- Wayne Dyer
"There is nothing as powerful as a changed mind. You can change your hair, your clothing, your address, your spouse, your residence... But if you don't change your mind, the same experience will perpetuate itself over and over again, for everything outwardly changed but nothing inwardly changed"
For those of you who follow my price action trading YouTube channel or my Forex price action website, you will know that I am big on price action trading. I love it and it works - a great combination :-)
Price action shows a Forex trader where price has been in the past and where it could be in the future. It consists of analysing price charts, identifying areas of market support and resistance, identifying price consolidations, market trends and recognising patterns formed by price. In one of my favourite trading books (Reminiscences of a Stock Operator), Jesse Livermore states 'I learned early that there is nothing new in Wall Street...Whatever happens in the stock market today has happened before and will happen again'. This is the principle used in price action trading - what has happened in the past will likely happen again.
Perhaps it is the Forex geek in me but price action has appealed to me from the beginning. I love seeing support and resistance respected and clear patterns that hold and signal big moves - probably because it builds my confidence in price action trading and my belief that it is a great way to predict the market.
Even though I am a price action convert and use it religiously to trade Forex, I have never been tempted to debate my beliefs or to shoot other types of traders down. But there are certain questions that I would like to pose and then answer; is price action the only way to make money when trading Forex? Do indicators work? Is fundamental analysis reliable?
Is price action the only way to make money when trading Forex?
The answer is obviously no. Price action is not the only way to trade Forex successfully. There are plenty of Forex traders that make a profitable return each year that are not price action traders. Saying this though, I have yet to meet a trader that does not use an element of price action as part of their Forex trading strategy. Even traders that rely heavily on fundamental analysis, usually use some form of price action analysis to enter or exit trades.
Price action may be the only way that you (as an individual) can trade profitably though. We all have our own trading beliefs and personalities. Price action trading may be the "holy grail" for one trader but not for another. The same could be said for fundamental analysis and for using technical indicators.
Do technical indicators work?
In short... Yes! From my experience, trading with indicators can be beneficial. But there is a big difference between trading technical indicators as a confirmation of price action and trading solely indicators. For example, an RSI signal is a great confirmation that price may start retracing, but it should never be the only reason to buy or sell a particular currency. Relying on solely indicators will lead to Forex failure. The same could be said for aspects of price action trading - price being at support is never a good enough reason to go long, but recognising that price is at support can be a great part of analysis.
How about fundamental analysis?
Same answer as above.
How price action trading has helped me
I have been a Forex trader since 2012. All of my Forex trading strategies are based on price action. I have seen my trading accounts grow using price action strategies - I am a true price action convert.
Price action helps me to know which direction I should be looking to trade, where to enter a position and where to exit a position.
I recently started a trading account that pushes my price action strategies to the limit (I am currently up by over 30% in just 6 weeks). You can follow the account on Forex Factory and myfxbook. The strategies and techniques used for this account are covered in my price action trading course.
You can learn more about me and about price action trading by following the links below...
My name is Sam Morton, I am an independent Forex trader. I have been trading Forex for nearly 7 years. I love what I do. My career has been very rewarding. It has allowed me to earn a decent living and has allowed my to work from home.
The purpose of this post is to outline the steps you need to take to become a full-time Forex trader and also let you know of some aspects of Forex trading you need to consider before committing to trading Forex as your main career. I have been there and done it. I consider myself an expert in this field - please give special attention to my advice.
Step #1 - Learn as much as you can (for free)
Believe it or not, you can learn a lot about Forex trading and how to trade Forex for free. There are countless websites and YouTube channels that offer free courses, free blog posts and free training on learning how to trade Forex. There are not many careers that require no qualifications and no payment for formal training but becoming an independent Forex trader is one of them. It does not matter who you are or what your background is, you have the potential to become a Forex trader!
The best thing about free online content is that you can learn in your own time. No matter if you are a student, employed or self-employed, you can learn in your spare time and go at your own pace. By browsing the web, you will be able to learn the basics of the Forex market, the basics of chart analysis, the basics of Forex brokers and how to profit from the market. To help you along the way, here are some sites that may help you...
Technical Forex - www.techncialforex.com - their free Forex 101 courses are perfect for beginners. They also have a trading Forum and other features that you may find useful.
BabyPips - www.babypips.com - another site that offers free courses and a free forum
My YouTube Channel - www.youtube.com/user/lovethepips - I have a range of basic trading videos to more advanced content. Perhaps start by checking-out my free Forex videos page.
Note: If you would prefer purchasing and reading Forex books to online content, Amazon UK and Amazon US have a wide selection of Forex trading books for beginners. Perhaps try eBay if money is tight.
Step #2 - Trade demo. Only demo
A demo or paper trading account allows a Forex trader to analyse charts and place trades as if he or she was actually trading. The money is virtual though - all losses and wins are imaginary/practice.
One of the most regretted mistakes made by Forex traders is that they decided to open a live trading account and fund it far too early. Don't do this. Listen to my words, you will lose your money. There is no rush. If you do not have the patience to trade a demo account for a season, you will not have sufficient patience to make it as a full-time Forex trader.
Once you have a demo account, you can practice what you have learned. Use your time with your demo account to learn how to execute trades, analyse charts, watch how markets react to news events and learn from mistakes.
The following brokers offer free demo accounts for aspiring Forex traders...
Darwinex - click here - for all traders outside the US. I personally use this broker and highly recommend them.
IC Markets - click here - for all traders outside the US. I personally use this broker and highly recommend them.
Once you have gained some experience and feel more comfortable analysing charts and making trading decisions, you need to develop a trading strategy and a set of trading rules (trading plan).
A trading strategy and trading plan will give you an edge. Trading is very much a numbers game. You win by leaning chance in your favour. Trading strategies can be based on price charts, technical indicators, news events and other aspects of the Forex markets. All successful traders have a trading plan and a trading strategy. A trading plan gives direction to managing your capital and ensuring that you are not taking too much risk.
My trading strategies and plans all came with experience. With time you will notice things that repeat themselves in the markets. You will notice money-making opportunities. These things need recording and compiling into a set of guidelines for trading Forex.
Step 3 is where most traders start to struggle. If you need help developing a trading strategy or with any other aspect of trading, please consider the following...
My Forex Mentor Program - learn from me directly. The programs consists of 6 online training sessions with me. The aim of the program is to make you a profitable and self-reliant Forex trader. You will also receive access to my course.
My Advanced Trading Course - learn my personal trading strategies and how I profit from the Forex market.
Step #4 - Start-off small
Once you have a trading strategy and trading plan, I suggest you then start trading with real funds. You will need to start with just a small amount of capital though. You will likely make mistakes - going from a demo account to a live account is a steep learning curve - but it is best to make mistakes with a small amount of capital rather than with your hard-earned savings!
Things to consider
Have a 2nd income
You will earn so much more if you can re-invest profits (compound trading). You will need to keep some profit in your account as a buffer against losing trades anyway. It would not be wise to draw all your profit each month. You will also have months where you will make no profit. You will have good months, mediocre months and bad months. Until you have a large trading account, Forex trading will not provide an income like a salary.
I strongly suggest you have or create another source of income so that you are not solely reliant on your trading income only. If you don't, the pressure will be too much and with a smaller-sized account it is just not practical. Why do you think so many Forex traders offer training and run trading related businesses?!
Forex trading will not allow you to get-rich-quick
Too many traders have unrealistic expectations. Forex trading will not provide 100% returns each month. Some of the best Forex traders in the industry gain anywhere from 20-80% per year.
Don't allow this to put you off though. Once you can make a consistent return and are a profitable Forex trader, many options will be available to you. You may have the chance to trade with investor capital, add to your own capital or even trade for a hedge or proprietary fund.
Don't let a lack of capital get you down. Focus on becoming profitable first and then focus on how to expand your capital from there. Having a large amount of capital is not a prerequisite to become a Forex trader.
You will receive criticism
If you choose to be public with your trading ideas and your Forex trading in general, you will receive criticism. Internet trolls and other viewers will put you down and call you a scam. Unfortunately, this is part of any industry when dealing with the public (especially online). Just a thought.
Trade to live, don't live to trade
Don't make my mistake. I love trading and being a Forex trader but I do feel that perhaps I have taken it a little too far and may need to reign myself in a bit. There is a lot of enjoyment in keeping trading simple i.e you trade by yourself, for yourself, in your own time. In recent years, my trading career has really grown. Until recently, I managed numerous trading accounts and a trading room, whilst also being a Forex technical analyst for a Forex broker and having my own personal trading account. Most people trade because of the freedom it provides. If you are not careful, trading may glue you to your office desk and try to take over your life! Please don't misunderstand me, I love what I do and am always looking for new students and the opportunity to grow love-the-pips. Just don't get to the point where you are no longer working toward your Forex trading vision.
There is a lot to consider when becoming a Forex trader. At some point, you will need to decide which of the many Forex brokers you will have a trading account with. You may ask yourself questions like; which Forex broker should I choose, what is the difference between Forex brokers, will my money be safe with this broker, is this broker trustworthy, is this Forex broker price competitive... Becoming a profitable Forex trader is hard enough without 'broker worries'. To help you choose a Forex broker a bit more wisely, let me offer some Forex broker advice...
What I look for when choosing a Forex broker...
When I need to open a new Forex trading account, I have criterion that the broker must meet before I decide to open an account with them. I have listed the criterion below in priority order...
If a broker is not well-regulated then I have no interest whatsoever in trading with that broker. Regulation helps to keep your funds safe and your trading experience legit. There is no guarantee with regulation - you can still lose your money if the broker goes bust and you can still have a negative trading experience - but regulation helps to prevent these things from happening.
All of my Forex trading accounts are with brokers that are registered and regulated by the FCA (regulatory body for the UK), the NCA (regulatory body for the US) or the ASIC (regulatory body for Australia). However, there are some very reputable brokers that are regulated by CySec (regulatory body for Cyprus).
I have a list of FCA regulated Forex brokers. You can view the list by clicking here.
By products I just don't mean which currency pairs are offered by the Forex broker or if the broker offers commodity and index CFDs. I am interested to know if the broker offers positive swap rates and how much the negative swap rates are (overnight fees), how tight the spreads are and how much commission is charged by lot/trade. All of these things are important to me - they all have an impact on my trading profitability. I see Forex trading very much like a business - the lower my overheads, the higher my potential profit.
ECN type brokers generally have the tightest spreads and best swap rates but there are some spread betting brokers that offer very competitive spreads.
#3 Trading Experience
Execution and how wide spreads widen during news events have a huge impact on my trading experience. I always open a demo account first and get a feel for the Forex broker before committing to a live account. Once a live account is open, I fund the account with just a small amount of capital first and then add gradually.
It is very frustrating to have a trade that is stopped-out by over-widening spreads which would have been profitable or a position that is not stopped-out and price continues past the stop-loss order! All Forex brokers can make mistakes and have technical difficulties but these things should rarely happen.
#4 Type of Broker
I am not interested in trading Forex with a market maker (most retail Forex brokers in the UK are market makers) but that doesn't mean that you shouldn't (I'll explain more about this later). 99% of my trades are with STP or true ECN Forex brokers.
My recommended broker...
My main trading accounts are with Darwinex. They tick all the boxes for me and are by far the best retail Forex broker (in my opinion). You can open an unlimited demo account by clicking here.
What I don't look for when choosing a Forex broker...
There are some things about Forex brokers that are just not important to me. These are...
Leverage / Margin
If your choice between Forex brokers is down to leverage than you either do not understand risk and money management or you don't understand the importance of margin when trading Forex. If a broker offers at least 1:33 leverage (and they all do) then you'll be fine. If does not matter if a broker offers 1:50 or 1:500 leverage, this has no impact on my trading, hence no impact on my broker choice.
If you need a Forex broker with a minimum of 1:200 leverage then it sounds like you are underfunded and need to save for a bigger trading account.
The Trading Platform & Charting Package
There are so many good Forex charting packages nowadays that there is very little need to use the package offered by the broker. If you hesitate to trade with a certain Forex broker because they only offer MT4 or they own bespoke package, then use the Forex broker for execution only. I use my Forex brokers for opening trades, managing trades and closing trades - anything else is a bonus. TradingView offer a great charting platform. Oanda's fxTrade platform is also very good (just open an unlimited demo account).
New York Close Charts
Just as above, if a Forex broker does not offer New York close charts who cares?! Just look at the alternative charting packages. New York close charts should not be a determining factor when choosing a Forex broker.
I don't mean to contradict what I said earlier regarding only trading with STP or ECN brokers. I do only trade with these type of brokers but if you are new to Forex trading then I think trading with a market maker broker (CFD broker, spread betting provider, etc) is a good choice. This is how I started. Going straight to an ECN type broker could have been too overwhelming for me at first. Market maker type brokers usually offer quick and simple ways to open and manage trades, ECN brokers typically do not - there is a lot more jargon.
Don't hesitate to open an account with market marker. You should be trading on demo at first anyway, if not, you are going to lose your trading capital nonetheless. Once you are consistent with trading profits and understand the Forex markets better, then is the time to make a transition to a STP or ECN broker.
My recommended broker is Darwinex. To open an account with them, please click here.
BrokerNotes is a Forex broker comparison site. You may find the website useful. Please click here to visit BrokerNotes.
Access to the Forex market offers the opportunity to be your own boss, work from home and make a lot of money, IF you are profitable. According to the statistics that are often shared online, around 90% of traders do not make money long-term and are not profitable. The dream of living a Forex traders lifestyle is often replaced with discouragement, frustration and disappointment.
So, how do I make money trading Forex? What is the 'secret' to profitable Forex trading? Why am I in the lucrative 10% of winning Forex traders? What do you need to do to become a successful Forex trader? Well, let me share with you how I make money from trading Forex...
How I make Money Forex Trading
It is all about having a trading system/strategy or having a trading plan
I have been trading for several years. I started by trading stocks and shares but later moved into European stock index trading and then to Forex trading. No matter what I have traded, I have always had a systematic approach to trading the market.
Having a clear set of trading rules in the form of a trading plan or a trading strategy or trading system is essential to trading success. Without these trading rules, traders are often left to trade their emotions, this almost always results in losing money. Fear, greed and boredom are the enemies of profitable Forex trading. A set of rules allows you to focus on a planned, back-tested and logical method rather than trading on what you believe you see or feel about the market.
These set of trading rules can include things like when to enter a position, when to close a position and how much to risk per trade. Trading rules for Forex can be based on technical analysis, fundamental analysis or a combination of both.
A trading strategy or trading system not only helps to minimise the psychological and emotional challenges of Forex trading, it also provides a trader with an edge - putting chance in the favour of the trader.
It is then about sticking to a trading system/strategy or trading plan
Once you have a set of trading rules, you then have to stick to the trading rules. There will be periods of draw-down, periods of consecutive losing trades and periods when you are not taking any trades. These times can be challenging and facing these obstacles is inevitable, no matter what your Forex trading strategy is. No Forex trading strategy will provide a 100% win rate (no losing trades) and offers numerous trading opportunities on a daily basis.
I am a price action trader. Analysing price charts, Japanese candlesticks and moving averages makes sense to me. I love studying charts and identifying patterns and other price movements. My trading rules are always based around price action and include things like candlestick set-ups, horizontal support and resistance, trend support and resistance and dynamic support and resistance. This is how I trade. It is simple and very methodological.
Something that a lot of YouTube channels and Forex educator websites lack is transparency. Questions that are often thought (if not asked) are...
Is this trader really profitable?
Does his/her trading strategy really work?
Is this a scam?
From the beginning of love-the-pips.com and it's associated Forex YouTube channel, I have tried to make honesty and integrity a major theme. If I were to have a slogan, I guess I would have something like 'Transparent Price Action Trading' or 'Honest Forex Trading'. To help support my goal of absolute integrity, I recently made a few changes that will help you to see my actual Forex trading results and get a better feel of my trading performance and what you can expect. I have listed these changes below...
Real Forex Trading Results
Up until now, my trading performance has been posted to my Forex trading results page. I understand that these figures could just be made-up and imaginary, so I have made the following changes...
Darwinex - I personally trade with Darwinex. They are not just a great STP Forex broker but they offer some social trading features that make it simple for you to view my Forex trading performance in great detail. I have created a public account that tracks all my Forex trades that are provided in my Forex trading room as of February 2017. The trading results are updated every 24 hours. You can view my performance per month and per year.
Click here to view my Forex trading results with Darwinex
Myfxbook - To add greater transparency and to answer the requests of a number of my followers, I have added my Darwinex account to Myfxbook. This site provides a lot of detail about my trades and is updated pretty much as I open and close my positions. You can also view the performance of my other Forex trading accounts, namely those held at SM Capital.
Technical Analysis - I am one of the head technical analysts at Truimph FX. Triumph are a Forex and CFD broker based in Asia. I have been part of their team for over a year now. I guess sharing this does not provide any added integrity to what I am doing at love-the-pips but it does boost my credentials.
Technical Forex - To echo my words above, I am also part of the Technical Forex team.
Click here to visit Technical Forex and to see some of my work.
Other works - I have been involved in other projects too. Some of these are listed on my Forex trading website home page.
The question is "are you looking for a Forex trader that shares his/her results and offers a honest service?". If you are, this is the place. I suggest your next step is to learn more by using the links below...
Free Forex Trading Videos - please view my free content on my Forex YouTube Channel or by visiting my Forex Video Archive Page.
Advanced Price Action Trading Course - learn my Forex price action strategies and gain price action insights by taking my Advanced Price Action Trading Course.
Forex Trading Signals - follow my trades by subscribing to my Forex Trading Signals. All of my trades are signalled by email and also in my Forex trading room.
Forex Mentor Program - learn from me directly no matter where you are in the world. Learn more on my Forex Mentor Page.