How To Improve Your Forex Trading Skills

Being successful in any trade is about constantly learning, developing and improving, and without this solid foundation of skills, a career in trading, especially at an instant funding prop trading firm, will be particularly brief.

Whilst it is always theoretically possible for any trader to end up in the right place at the right time, relying on luck rather than skill is akin to expecting lightning to strike the same place twice; whilst it can happen, it is not something you would want to rely on.

It is especially impossible in forex trading, where the kinds of volatility that make the stock market and cryptocurrency popular with casino capitalists do not really exist.

The alternative is the longer, more worthwhile road, and here are some top tips to help you travel down it.

Start With The Fundamentals And Then Build

In a world of increasingly complex derivatives and difficult computer-driven trading strategies such as high frequency trading (banned in most prop firms for obvious reasons), a good rule to start off with is not to execute any trade you do not understand.

Some people then stop learning, relying on the initial knowledge they started with and end up surprised that they are not seeing any improvement in their results. Instead of playing it completely safe, see it as a challenge to build your skills.

Understand What You Did Wrong As Well As Right

Reflection is a key part of successful trading, but it is also important to focus on the aspects of the trade that were within your control and that you were capable of changing. Only then will you be able to take the right lessons away from gains and losses.

As most traders can unfortunately attest, you can do everything right and still lose. That is the nature of the market, and in many respects to life itself.

The problem is that sometimes this sends out the wrong subconscious message that a sound strategy that was carefully executed but also unfortunately caught up in a black swan event was a mistake that you should avoid in the future.

Conversely, casino traders who gamble on a high-risk, high-reward trading play sometimes succeed. But anyone can win the lottery once. It does not take any skill. But even if you do hit the jackpot once, the chances of it happening again are as close to zero as making no odds.

By looking only at the processes and decisions you made, which were in your control and should be recorded in a trading journal, you can see the thought process beyond the result and get a better idea of which aspects worked, which did not and what you can learn from for next time.

Build Up Resilience Under Pressure

Financial trading is going to be filled with pressure, as many trades involve huge sums of money and some degree of risk in order to make a profit.

It is easy for that pressure to get to people, and the entire field of behavioural economics has emerged to try and explain how the market reacts when people collectively fold under pressure.

The best way to do that is to build up a trading plan and stick to it. It is your guide for handling any given situation and helps ease the pressure somewhat, allowing you to focus your mind on the big-picture decisions that you need your complete focus on.

Develop Your Mental Maths Skills

The most beautiful part of computer trading is that you do not need to solve any sums or have a maths degree to get by, but despite this, a good way to boost your forex trading skills is to 

develop your fluency in arithmetic and processing numbers.

There are a few reasons for this. The most basic and most important is that your brain is much faster than you give yourself credit for, and it is often quicker and easier to work out an equation in your head than type it into a calculator.

The difference is typically only a minute at most, but given just how fast the market moves, that can be enough time to let a potential trade get away from you.

Embrace Your Passion For Trading

Have you ever noticed that you find it so much easier to learn skills in fields that you are interested in compared to the ones you are not? If you have a passion for trading, then embrace it and let that enjoyment come through in how you trade.

There is a lot of pressure and it is a business decision rather than a hobby, but at the same time you can find joy in what you do and following the markets should at least at some level be a joy.