The Best Forex Success Formula - What Is It?

Forex traders around the globe are forever hunting for that elusive trading formula that will ensure success in all trades

. The truth of the matter is, however, that what works great for a specific trader might not be the best forex success formula for another one. Let us briefly analyze the reasons for this.

The most important reason why a trading system or formula might work excellently for one trader, but not well at all for someone else, has to do with the fact that traders are in the first place human beings. Their decisions are therefore influenced by emotions. They have weaknesses and they have strengths. They make errors, because they are subjected to fear, greed and excitement.

A trader with many years of experience will for example be able to trade without using a stop loss. His experience will have taught him that you should never hold on to a trade once it's clear that it's going the wrong way. An amateur trader might find this very hard to do. He could be totally unable to close down a losing trade if he doesn't have an automatic stop loss system doing it for him.

The same goes for winning trades. A trader with years of trading behind him will be well aware that you should never close a trade before it has reached its full potential. A novice trader will often get highly excited the moment one of this trades moves into a profit situation. He will then cash in the trade long before it has matured. This way he will never make big money.

This does not mean to say a trading formula or system is unimportant. It is in fact of vital importance. Without a trading system, you will time and time again end up trading based on emotions and rumors. This is no way to be successful in trading.

For new traders, the best course of action is no doubt to start trading on a free demo account. They should select a trading system which they can live with and test it for a few weeks. After trading profitably for some time, such a trader could consider switching to a live account.

By modifying your trading system over time, you will eventually develop the best system for your specific situation. This will take into account your personality, your strong and weak points and the amount of money you have available to trade with. Once you found the best forex success formula, trading will become even more enjoyable and a regular source of income.

by: Deoh Carullo.

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