Hello once again Forex Market traders and regular readers of my article. Firstly I would like to thank all of you who emailed me in the last few weeks with your feedback on my article from a few weeks ago:?FX Trading Mind-Set 101. I am glad you all enjoyed the piece and that it got you thinking a little more deeply about your mental game and its impact upon your trading as well. At the end of that article, I promised to follow up with a topic on listening to what the market is telling you, a subject which most definitely requires a complimentary solid mental attitude at all times. Let?s get down to talking about our boss?
Before I go any further however, I would like to say a huge thanks to my good friend and fellow Online Trading Academy instructor Scott McCormick, for throwing this concept at me in the first place. On a teaching trip we did together last November in Charlotte NC, we were discussing different methods of teaching and he put the concept to me and I loved it from the very start. Thanks Scott! I hope I can do it the justice it deserves.
I would like you all to think back to the days when you first considered trading the markets and more importantly, the reasons why you wanted to embark on such a career progression. For some people, they simply want greater financial security by generating regular short-term income or maybe they want to find a way to protect and grow their long-term wealth, or maybe even both? For others, it is all about having more time but one thing I have found to be a common theme amongst everyone, is that they love the idea of not having a boss and working for themselves. I must admit that this was one of the most attractive reasons for me personally. Now while working for yourself as an independent market trader is just like having your very own business and is a career which basically allows you to call your own hours, something that you really can?t get away from is the simple fact that you still do have a boss and that boss is the market itself.
People mostly don?t like being told what to do. Deep down I think we all understand that we need to follow some rules in our lives or there would be complete and utter chaos. However, while we follow rules in life we also like to be free to do what we want to do. Heck, I know I do. One of the most frustrating things about having a regular job is having a boss who is constantly telling you what to do. It then gets even worse when that boss tells you to do something that you know is wrong or that is likely to result in failure. I think we all have had to do that at some point in our working lives. It then gets especially hard when you do as you are told because you have to and because you want to keep your job, only to see things not work out for the better and your boss gets none of the blame and you do instead! Frustrating times indeed. No wonder people want to learn to trade the currency markets and be free from such situations. Well guys, don?t get too carried away quite yet because the shadow of the boss is always looming somewhere in your life, no matter what career path you follow. Enter your new boss: The Market.
When it comes to trading, having an opinion does not really matter in the long run. What really makes the difference in the long run is building a solid trading plan, developing rules, and then finally listening to the market to tell you when to take action. When the market or as I should say, The Boss says take action, then you had better take action. No matter if the trade turns out to be a winner or a loser, the key thing is to do what you are told and pull the trigger. You have a stop loss to contain your worst-case scenario and a profit target if the trade goes well. What more do you need to do but follow the plan when the boss says follow the plan. Sometimes your boss will tell you to do things that make you feal a little uncomfortable but you still need to push forward, even if it feels a little uncomfortable. Let?s take a look at a recent swing trade I took on the GBPJPY which required me to listen to the boss and do as I was told:
Price had been in a decent upwards trend and was steadily approaching a quality-assessed Supply Zone, which offered me a solid setup and a strong risk to reward profile as well. Over time it does get easier and easier to short a rally (although most technical analysis theories would tell you not to), but I simply listened to the boss (the market itself) and placed my order in a set and forget fashion for an entry around 173.00 and a profit target around 168.00. After all, when the boss speaks to me I know that I need to listen! Just about 1 week later the trade hit target as below:
Make no doubt about it, following your trading rules and listening for the signals from the market and nothing else whatsoever is not always the easiest thing to do but I have learned to do as I am told as my feelings are really inconsequential in the grand scheme of things. The only opinion that ever really matters at the end of the day is that of the market itself. Yes, I still have a boss after all these years as a trader but it?s really not anywhere near as horrible as the ones in my past?I really hope this helped.
Take care and be well,