Hidden Secrets behind becoming A Forex Expert!

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1 Hidden Secrets behind becoming A Forex Expert! From Special Report from

2 Risk Disclosure Statement The contents of this e-book are for informational purposes only. No Part of this publication is a solicitation or an offer to buy or sell any financial market. Examples are provided for illustration purposes only and should not be constructed as investment advice or strategy. All trade examples are hypothetical. No representation is made that any account or trader will or likely to achieve profits or loses similar to those discussed in this e-book. By purchasing this e-book, and/or subscribing to our mailing list you will be deemed to have accepted these and all other terms found on our web page in full. The information found in this e-book is not intended for distribution to, or use by any person or entity in any jurisdiction or country where such distribution or use would be contrary to the law or regulation or which would subject us to any registration requirement within such jurisdiction or country. CFTC RULE HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN. Copyright Information The manual contains material protected under copyright laws. Any unauthorized reprint or resale of this material, free distribution is strictly prohibited. 2 Special Report from

3 Forex Trading is a very lucrative market. With 3 Trillion USD on stake each day, the opportunities are endless. Any trader who joins the market has a potential to make huge money each month, month after month for years to come. Yet, we all know this is far from truth. You must have heard the 80/20 rule which says 80% of problems are caused by only 20% of resources. The same holds true for forex market, with a slight change. In forex market the ratio is 95/5 which means 95% of wealth is controlled by only 5% of traders I mean, here is what the day of a usual trader, let us call him Andy, looks like - Andy gets up every morning at 7:30 am to start trading by the time New York Market opens. He opens his trading station. His mind every morning says to him Forget about yesterday! Let us make some money today. He then opens his chart and selects one of the 15 currency pairs available. He looks at the chart and says to himself. This looks like a sure shot trade setup. Andy opens the trade. And he places the stop loss just for the sake of formality as he doesn t take it seriously. Infact Andy places the stop loss quite wide since he doesn t expect the price to come that down that it will hit his stop-loss. Sounds Familiar so far? Good, this is where things get more interesting. Everything starts out just fine. The currency pair ticks up as you expected and continues in Andy s anticipated direction for next few min., but then without explanation, the price starts to turn and Andy feels holding his breath as the 3 Special Report from

4 price starts a rapid and relentless downward march toward his wide stop-loss. For Andy, this surprising, depressing and frustrating since as per him there is no reason for this to happen. Needless to say his confidence starts to fade. He actually gets pain his stomach. His hunger goes away. So he skips his breakfast. Frantically, he tries to figureout what has gone wrong with his analysis. But more than that he is worried about the price hitting his stop loss. So, he pushes the stop loss even further way, since as per him the currency pair can definitely not go that low. This calms down his nerves a bit. 1 hr goes by. Andy, by now has taken his breakfast an completed part of his morning routines. And he ready to check back his trading station. He is optimistic that by now his losing position would have recovered quite a bit. But as he checks the current price of the currency pair, his heart skips a Beat. He has been stopped-out. His shoulders slump and he gently puts down his head on his desk wondering what is going wrong since this is NOT the 1 st time it has happened. He was wrong and deep down inside-on a subconscious level, he-like almost all of us don t like to think of himself as being wrong as being guilty. Andy had panicked when he 1 st saw that his trade was running in loss. He made the matters even worse by pushing the stop loss even further away. Andy is thinking about why he violated the rules he had established in regards accepting loss as part of game. Why did he move his stop instead of accepting loss? This is a typical story of Andy.. 4 Special Report from

5 Shocking..But True! Depressing.. But True! Frustrating..But true! I don t know about you, but the big shock is that this story happens more or less with majority of traders. I won t be surprised if more than 60% of traders have experienced such days! Can you relate yourself to this story? Think for a second, what is the reason Andy is having such trading days every now and then? Was it the fear of losing money because he placed too much emotional element on his trade? Or was it because he was just trying to prove that he is Smart? If I think on this, I know the reason behind the issue is basically the human instinct of defying the rules or straying from Plan. Never a good idea in forex trading! And till the time Andy keeps doing this, he will never become a forex trader. Instead he will remain a gambler. Consider the typical problems which involve the trader. As with most of us in a modern society, you are raised with the idea that losing is bad. It reflects directly on you. Losing equals shame, which equals pain. A natural response to pain is to avoid the situation that causes it and losing trades and the pain that causes is probably the main reason that most novice traders return to the safe haven of passive investing or keep adding to the losing position! The fact is, to some, losing motivates and they start what I can say a vengeance against the market placing one impulsive trade after another to recover the losing ground! But for most, it is just plain easier to deny responsibility and avoid the situation and the risk of pain. To most of us frail human beings, mental and psychological pain is worse than physical pain. 5 Special Report from

6 Let us look at what are the side effects of such attitude. When a trader has a losing trade, if he is not rationale about the loss, he will have a risk of placing one trade after another after another without any reasoning. Naturally most of these trades will end in loss! If they do, they will have the next psychological effect The trader will start losing confidence in his analysis. Due to this next time when his analysis is right, he may not be ready to open the trade. His hands will be shaky and he ll second guess his judgment. Now imagine, if one such trade that he let go turns out to be a huge winner? Do you remember the market movement that happened in 2004 on USD/JPY during which market I guess moved more than 1500 pips in a matter of days? If such case happens to Andy, I am sure he ll be more depressed than usual. Not only he lost money in trades, but he let go a good trade as well! And this my Friend is one of the main reasons why only 10% trader make money and rest keep struggling on the other side of fence. You see, most traders are not attuned to the fact that these mental and emotional aspects of trading are just as important as having a good trading system. No matter how good a system is, there will always be losing trades. But the key is for the trader to understand the reason behind the loss and accept it! If a trader doesn t have a good grasp of the nature of trading and the psychology needed to sustain oneself through the tough times, trading can be a surprising and often disappointing experience. Being able to deal with the losing trades is what separates successful traders from ex-traders. One of the intangible benefits of learning to become a successful trader is the fact that you usually become a much more honest and introspective person. You learn to honestly appraise your performance and probe your weaknesses. How can you Do that? One thing for starters Always maintain a TRADING LOG! 6 Special Report from

7 Record each and every details of the trade you place. Right from the currency pair to the reason for placing trade. Right from the time of the trade to reason behind why you closed the trade. Capture each and every detail and then after closing, try to analyze the result. Find out what you did right & what did you do wrong! If you fall into the habit of maintaining an accurate trading log, that itself will make you a much much better trader than what you may really are! Most trading systems require that losses be cut quickly and margins on losing trades be at least half the target profits for winning trades. So, conceivably a trading system might only produce winning trades 50% of the time but the margin of the winners would be twice as large as the losers. In such cases, the trading system would be a net winner even at a chance level of winning (50/50 flip of the coin). This is why it is essential that a trading system must stick to the cut losses quickly rule. Successful trading is a game of probability and an effective system is one where the win-loss ratio is over 65% and the losing margins at least half the margin of winning trades. Remember Forex Trading is a Business. Loss and Profit is a part of any business. But the art is to make sure that the losses are cut short and profits remain high! The inability to enter into a trade when the confidence is low also demonstrates a lack of discipline in sticking to the trading system. Either it s a go for the trade or its not. If a trader s system has too many poorly defined areas, it should be changed. 7 Special Report from

8 Trading Plan should be absolutely clear in terms of telling if the trade should be placed or should you stay away from the market! Simple. The same goes for criteria behind closing a trade. The trading plan should clearly tell you when to close the trade. It is really painful to see losses compound or hard earned Pips melt away. See, you are trading forex because you want financial independence. You want to spend more time with family stress-free. So forex trading should be a stress free experience for you. After all 10% of traders are making huge money from this trillion $$ industry.. right? So, what we need to do is establish a frame-work of not only how to trade our system but also how to manage emotions and mental discipline. A trader needs to establish procedural constraints and then learn how to match feelings and thoughts to the trading process. And that is why to become successful in Forex Market you need a forex course that is much more than a trading system. A trading system is just a component of a forex course. A full-fledged forex course will not only cover a highly profitable forex system, but will also lay down clear guidelines in terms of when to enter a trade, when to exit a trade. How to manage a winning trade and what to do when the trade is not going your way! Thanks for reading this manual! I would really like to hear your comments! So write to me and let me know what you are thinking. Oh By the way, Watch out for my next as I have something more in store for you which I am sure you are going to enjoy. (Did I tell you that you will get that for free as well!!??) 8 Special Report from

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