5 USEFUL TRADING STRATEGIES
The end of the year is extremely nigh and we can probably all agree that it’s been something of a tumultuous 12 months. There have been highs and there have been lows, but with 2023 just around the corner, there’s perhaps no time quite like the present to look to the future and start making plans for the year ahead.
Of course, this time of year is also perfect for a spot of reflection and we certainly shouldn’t ignore everything that’s happened over the last few months, especially from a forex trading perspective. Looking back can help us move forward in a positive, proactive and meaningful way, helping us to grow and progress as traders… and as human beings!
So, with all this in mind, here are just a couple of new year’s resolutions you might like to consider making come January to help you hit your personal and professional goals and really bring the successes you’ve been chasing home to roost.
1. Follow the news
Currency pairs are greatly affected by what’s going on around the world so keeping up to date with all the latest economics news can make a huge difference to your performance as a trader.
All signs are currently pointing to a global recession in 2023, with central banks all over the world now hiking interest rates in response to inflation, which is definitely something to keep an eye on.
As we all know, economic recessions are completely unavoidable and it’s only a matter of time before they come around again, so now’s the time to think about how best to go about navigating your way through a downturn. You may find you’re able to turn changes in national economies into trading opportunities with just a little bit of preparatory work.
If we do indeed see a recession next year, factoring this into your strategy now could be useful. Consider your investment timelines as it’s possible that the slowdown could last for years and be strong when it comes to cutting your losses if you need to, as this will allow you to maximise the returns on your profitable trades.
2. Focus on your health
Yes, health goals are always a really popular new year’s resolution whether you’re into forex trading or not, but ensuring that you do make your mental, emotional and physical health and wellbeing a top priority will certainly stand you in excellent stead as a trader throughout the year.
It can be tempting to really go all in when you’re new to trading and it’s not uncommon for people to sacrifice other areas of their lives in order to trade as much as possible. This approach, however, can quickly lead to burnout and, before you know it, you won’t be able to trade – or do anything much at all.
In order to ensure that you can continue seeing progress as a trader, make sure that you’re getting consistently good sleep each week so you don’t cloud your judgement and decision-making abilities.
Following a healthy diet full of fresh fruit and vegetables can also help you stay on track, as can getting regular exercise. Staying hydrated can also ensure that your mind remains clear and you stay focused on your goals.
Just don’t forget that your health and wellbeing also depends on you not being too zeroed in on any one activity.
It’s very easy to be lured in by the wonderful world of trading and it’s understandable if that’s all you want to do with your time, but it’s essential that you devote your attention to other interests and pursuits, as well as family and friends, so you can go back to your trading feeling renewed and refreshed.
3. Practise discipline
There are all sorts of essential skills that you’ll need to develop as a trader but discipline is perhaps one of the most important of them all. Without a disciplined mind and attitude, you’ll find that even the most robust trading plan and even the most stringent risk management approach lose the value they once held.
However, the good news is that discipline is most certainly something that can be learned and, in fact, you’ll likely find that it’s something you need to continue learning. Forex trading moves very quickly and it can be a frustrating endeavour, as well as an exciting one – and you are sure to be tempted to stray from the path at some point.
Even the most seasoned professional traders struggle with discipline and find themselves considering dubious trades and courses of action, so making this a top new year’s resolution for 2023 could make a big difference to your success rate.
There are various ways you can help yourself improve your self-discipline skills. Writing down your goals and putting them somewhere visible can help you keep your eye on the prize, for example, as can setting yourself smaller more achievable goals instead of trying to go for the big one from the outset.
4. Keep a trading journal
We’ve said it before and we’ll say it again… your trading journal is your very best friend. Keeping a journal is one of the very best ways to drive performance and make you feel more confident about your abilities as a trader.
Successful trading is an ongoing learning experience and you’ll find that you never really graduate as a student. There are always new lessons to learn and new ideas and concepts to consider, which is why journaling is so very useful as it allows you to see your strengths and weaknesses, showing you where to divert your attention.
Use your journal to record and review your daily trades so you can flick back for future reference and see where you’ve gone wrong or where you’ve gone right. You may well find that in so doing you’re able to progress far quicker as a trader, with your trading plan and strategy based on real-life experience rather than speculation and guesswork.
Journaling can also help you offload if you’ve had any particularly negative or positive experiences. Emotion can ring the death knell for successful trades but writing can help you clear your head and allow you to approach your trades in a more clear-headed fashion, facilitating the learning process as you go.
5. Find a support network
Trading can be a very solitary activity, but it can be damaging to spend too much time on your own, from both a professional and personal perspective. As such, finding a trading support network could help you make new friends, find new points of view, discover new ways to trade and give you somewhere to turn to when you inevitably take a few big hits.
There are lots of different trading communities to be found online so it’s simply a matter of doing a bit of research to find one that suits you and your particular needs.
This could be particularly useful if you’re just starting out and aren’t quite sure where to begin and what to do. It can be quite overwhelming when you first start trading but having people with more experience close to hand that can help answer questions you have over time.
That being said, don’t forget that you can also go to your family and friends as sources of support and they certainly shouldn’t be discounted in this regard. They’ll also be able to help you take your mind off trading and help you take a break, so make sure you give them a call when you need them, as well!
You might also want to consider trying to find a trading mentor, someone you can turn to for guidance as you find your feet as a trader. Make sure you’re careful who you choose, however, as there are scammers out there masquerading as mentors who won’t have your best interests at heart.
How to stick to your new year’s resolutions
Making new year’s resolutions is only half the battle… now you actually have to stick to them! There are lots of different strategies you can employ that can help you achieve your goals, but don’t forget that you will need a lot of willpower as well.
First of all, focusing on one goal at a time can help you see success more quickly. Breaking your goals down into more manageable chunks allows you to progress more efficiently and can help spur you on to the next stage of goal attainment.
Writing out a detailed plan of how you intend to go about achieving your goals can also help you visualise what you need to do, as well as helping you to keep your eyes on the prize.
And thirdly, practising patience is an absolute must for any new year resolutions. You can’t expect to see lasting change take place overnight, so just make sure that you’re not putting too much pressure on yourself and make sure that you give yourself the praise and congratulations you deserve when you do see those small wins start to add up.
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