February 7, 2014

Being Accurate On The Foreign Exchange

foreign exchange

The foreign exchange is not like other investment markets. There are some very subtle but crucial differences between the forex market and other markets like the stock exchange or the futures market. One of these differences is that the forex market does not require as much precision as other markets require from their traders.

When individuals who have experience of other investment markets enter the world of foreign exchange, they mistakenly follow the same tactics that they were using in the market that they came from. Thus, their inability to realise the unique nature of the forex market ends up being the main reason for their downfall.

What Does Being Too Fussy about Accuracy Mean?

If you have also come from another investment market then it is likely that you are thinking how a person can be too fussy about being accurate or being right. On the foreign exchange, this is entirely possible.

Being too fussy about accuracy means that you will keep trying to pick tops and bottoms to a point where you cannot make up your mind and freeze when you should be acting. While habit is the main reason why you can become obsessed with being accurate, there could be other reasons as well. Consider the following.

Ego Could be One of the Reasons

One of the reasons why you have become obsessed with being right could be your ego. If you are an extremely proud individual then being proven wrong would be an even bigger problem for you than losing on the foreign exchange. Thus, in your bid to be proven right, you will start avoiding the closure of losing trades so that you do not have to face being wrong.

Fear Could Be Another Reason

Another reason which can make you obsessed with being right could be your fear of losing money in your account. Because you would not want to lose your money, you would start looking for signals which are fool proof and certain to give you profits. As there are no fool proof signals, you would be waiting a long time.

Finding a Solution Is Important

Being too fussy about accuracy on the foreign exchange is going to be counterproductive for you because it would keep you from starting off from the finishing line itself. Here are a couple of ways you can counter this desire.

Accepting Losses Will Help

First and foremost, you should accept that losses are inevitable on the foreign exchange. There is no way that you can have a career in the forex market and not incur losses. Therefore, the sooner you accept this aspect of the forex market, the better it will be for your career.

Introspection Can Be Critical

Introspection will also help you in overcoming this desire to always be proven right on the foreign exchange. It is likely that this desire of yours has roots in an insecurity of some kind that you have not realised yet. Introspection will allow you to recognise this insecurity which will immediately make it less potent.



Get a free Forex PDF PLUS:

  • 14 Video Lessons
  • Free One-on-One Training
  • A 5000$ Training Account
  • In-House Daily Analysis
Become a forex trader!

Comments are closed.

Free PDF and UNLOCK website features