How the success of currency trading

Below are six common beliefs that most traders hold - and if you also believe these myths, they will limit your chances of making significant profits from currency trading. Ninety percent of currency traders believe at least one or more of these myths - which explains why ninety percent of traders do not make much money trading currencies! 1. You should always be in the market in case you miss a move Traders love excitement and their view is that if they are in the market they can catch a big move. Well, they can - but chances are they won't. Big trends only come a few times a year in each currency - and you should stay out of the market until they do, or you'll suffer losses and earn commissions that drain your account. Wait for big trades - Patience is a virtue in trading. 2. Diversification reduces risk and increases profit potential Diversification simply dilutes your profits. You have made a big move and your other trades that are losing or giving you only marginal profits eat up all your currency trading profits. You have to have the confidence to make big moves when they happen and record those trades. Currency trading is all about calculated risks – if a trade looks good, hit it hard to make big profits. 3. Day trading is better than long-term trend following because it is less risky. This myth is spread by many brokers - and why not? – They earn more commissions if you believe it! You will have more losses than gains when trading. You will never make enough money in a day to cover your inevitable losses. When you add commission and slippage, it's inevitable that you'll lose. You need to hold on to longer term trends as they bring big profits to cover your smaller losses. 4. Market timing is the right way to make a profit Market timing means you are trying to PREDICT where prices will go up and down - this is not a good way to trade and the odds are against you. A better way to trade is to wait for the market to CONFIRM that a trend is underway and jump on board. You can't buy the bottom or sell the high, but you can catch the major part in between - and with currency trends lasting many months or years, you can still make a lot of profits from the trend. 5. Markets are the same today as they were hundreds of years ago Garbage! Current trends are much more volatile than 50 years ago. Why? Today, with the Internet, price information reaches all corners of the world in a fraction of a second. This increases volatility because everyone has the same information at once – and everyone is trying to enter the market at the same time. This was not the case even 50 years ago - trends still exist but volatility is much higher - traders find the direction of the trend right but find that volatility stops them. How often has this happened to you? – It happens to all traders. Look into using options that give you stamina. 6. You can use the Black Box system to earn money You can buy a system from a supplier for several thousand dollars - and he can earn 50-100% per year. These systems usually have hypothetical results - and use price information where the results are already known, and of course the logic of the system remains hidden from you - as it is unlikely to have a solid foundation. Have you ever wondered why these dealers sell systems when they can simply get a bank loan and trade their own systems? Enough talk about this! How about some positive advice? If you want to make big profits from currency trading, you have to do it for yourself. Get a plan you trust and execute the plan with discipline - and have the courage to trade big profits when they happen.