How to Become a Full-Time Forex Trader
Becoming a full-time or ‘professional’ Forex trader is something that almost every trader wants to achieve but that very few ever do. If you want to have a realistic chance at making a full-time living from the markets you are going to have to approach your trading with a disciplined and patient mindset, that is perhaps the single most important piece of insight I can give you. Also, you need to understand that there are no “magic-bullets” or “Holy-Grail” trading systems, despite what you have probably read on other Forex websites.
I teach traders how to trade with simple yet high-probability Forex price action setups on this website. There are no guarantees and no promises of trading from the beach next month while making a million dollars a year. If you want honest and relevant education on how to trade the markets, then continue reading, if you are looking for a “quick-fix” then I suggest you leave now.
Here are some of the critical steps you’ll need to take if you want to make your living trading the markets:
1) Be realistic and honest with yourself
The first thing you need to do if you want to make a full-time living trading the markets is to simply be realistic and honest with yourself about what is possible at the current moment given the size of your trading account.
For instance, if you’ve got a $2,000 trading account, you’ll have to set your sights a little below ‘full-time trading’ right now, and just aim to supplement your income each month via your trading. You have to learn as soon as possible that you can’t ever risk more than you are comfortable with losing per trade, and if your trading account is relatively small you have to expect to trade smaller position sizes to accomplish this. A small account means trading small position sizes to properly manage risk, at least until you’ve built your account up over time. So, the first step to full-time Forex trading is to simply sit down and say “OK, I have this much money in my account, realistically I am emotionally OK with losing this much of my account per trade, so this is what my position size will be”, then you have a starting point.
You can’t worry about getting rich quick or fret over making less money than you want. Focus on being a good trader whilst your account is small and I promise you the money will follow later. Traders who put too much emphasis on the money in the beginning of their career are the ones who end up losing and quitting.
2) Make sure you know the basics of Forex
This step is sort of a no-brainer, but I’m always surprised at how many traders email me saying they’ve lost a bunch of money and based on the comments in their email it’s apparent they don’t even have a basic education on Forex or Forex trading. So, make sure you understand what the Forex market is, why it exists, and basic trading styles BEFORE you start trading with real money, you can take my free forex beginners course here.
3) Master an effective Forex trading strategy
You only need to master one trading setup to be a consistently profitable trader. Screen time will allow you to master one setup. After you have mastered one setup and “own it” you can add another setup. This can be an ongoing process developing your own style.
The best price action setup to begin with is the one that you see and understand easiest. If you are forcing yourself to learn a setup because you believe another person is successful using it you may be taking the longer route to profitability. We are all different. Our brains and personalities will gravitate to different setups. This is also true of exit techniques. Most traders I hear from lengthen their road to profitability by trying to apply too many concepts before owning the first one. They have studied a myriad of techniques but have yet to master any. This allows them to talk about trading but they are unable to consistently trade profitably.
The first decision to make is; do you desire to be a counter-trend trader or a trader who trades with the trend? Eventually, you can be both. At the beginning, or at a new beginning perhaps, you will do best by choosing to master trading one setup with the trend. If you have been at this game for awhile and are not yet consistently profitable you know what I am saying is correct.
This site contains trading techniques and setups with the intent that it will aid you in creating your own personal trading style. My personal trading style is a combination of various styles and setups. I trust this website will be an exercise in my personal understanding of my own style allowing all to benefit. So, learn what I teach here and then “make it your own”, every trader will trade price action a little bit differently, there’s nothing wrong with that as long as you keep it simple and remain disciplined.
4) Make a Forex trading plan (and use it)
Next, you need to solidify your mastery of your trading strategy by creating a Forex trading plan around it. If you learn from me you are going to learn my price action strategies, thus you’ll need to build a price action Forex trading plan before you start trading the markets. It’s really not that difficult to make an effective forex trading plan, click on that link to the left to learn more.
A trading plan is a critical element to becoming a full-time Forex trader because it acts as a guide for you to follow and as a constant reminder of how to trade your strategy. This helps you to stay focused and disciplined and helps you to avoid over-trading, over-leveraging your account or generally trading emotionally. Emotional trading is the reason why most traders lose money in the markets, and by creating and using a Forex trading plan you can give yourself a much better chance at avoiding turning into an emotional trader.
5) Make a Forex trading journal (and use it)
You also need a Forex trading journal so that you can track your trades and see your trading performance over time. The reason I said “and use it” in these last two sections, is because many traders create a Forex trading plan and forex trading journal and never use them, or they use them for a day or two and then upon their first losing trade they forget about them. You’ve got to have more discipline than that, understand and accept that you aren’t going to win every trade and you’ll have a far easier time sticking with your plan and using your trading journal religiously. Don’t treat trading as a game, because it isn’t, it’s a business, and if you’re trading with real money you need to treat it like a business. Businesses have plans and they track their costs vs. their profits, you need to do the same with your trading business.
After you have mastered an effective trading strategy and forged a trading plan around it and have your journal ready, you can start practicing your trading strategy on a demo account. Do not blow-off demo trading as something you don’t need to do, because you most definitely do need to do it. Demo trading allows you to get familiar with your broker’s platform if nothing else, and this is important because many traders make silly trading errors just because they aren’t familiar with how to input or close orders, and when trading with real money this can cost you dearly. I suggest any serious trader practice their trading strategy on a demo account until they are consistently profitable for 3 months or more before even thinking about trading with real money. It’s true that there is a difference between demo trading and live trading because there’s no emotion involved in demo trading, but if you treat your demo trading like a live account it will do a good job of preparing you for real-money trading, which can save you tons of money and time.
7) Risk Management
Managing risk should be seen as your number 1 priority if you want to become a full time forex trader, because if there’s one thing that full-time Forex traders do exceptionally well, it’s manage risk effectively. Simply put, you CANNOT become a full time or professional Forex trader if you don’t properly manage your risk. Managing risk properly means NEVER risking more than you are comfortable with losing per trade as well as never funding your account with money that you aren’t truly OK with losing.
You need to understand the power of risk reward and you need to also understand position sizing, as these two things are crucial components to correctly managing your risk in the Forex markets. Amateur and struggling Forex traders by definition do not manage their risk properly, and it’s one of the main reasons why they don’t make consistent money, not because they haven’t found the “perfect” trading system yet. No trading strategy or system will work if you don’t use it in conjunction with an effective risk management strategy.
8) Trading Psychology
Finally, the fundamental difference between beginning / struggling traders and professional / full-time traders, is that full-time traders think differently about trading. Struggling traders tend to gamble in the markets whereas professional traders view trading as more of a business and take calculated risks. It’s very easy to become over-confident after a winner or a few winning trades in a row, and it’s also very easy to become vengeful after a losing trade and want to jump back into the market to try and make back the money you just lost. However, when you have these feelings, you must understand they are not logical and they are not part of your trading plan. Indeed, it is HERE that your Forex trading plan comes into effect. After every trade you take, whether a winner or a loser, you should go and read your plan to make sure you stay focused and don’t jump back into the market for an emotional reason. Check out this cool article on developing the proper Forex trading mindset for more, and if you want to learn more about learning price action trading strategies and how to formulate them into an effective trading plan, checkout my price action Forex trading course and member’s community.
10 Comments Leave a Comment
Thank you for the article especially on money management by position sizing and protecting the capital .Please have the option of sharing the articles on fb and others social sites so that many get this information.
This article makes me see the trading in a different perspective…a business perspective. I liked your stressing point…”stick to your trading plan and use the trading journal religiously” wonderful.
I think this was a very important article because a lot of people think they can jump their way into becoming a full time trader not realizing that just like any other business it will take time. Not only because they have to deal with the markets, but because they will have to deal with them selves… and in my opinion that right there is the hardest battle of all … nonetheless very good points.
Thanks for the lesson sir
Really like the demo trading approach, good to get a level of familiarity, before the real deal.
I’m grateful to have found your training website.
To my amazement I started to become profitable the day after I viewed your most recent video on the 3 candle setup on the EURO/USD. I played this setup on the USD/CHF Reversal. Walla!
Thank Nail, Now I am learning the trendline, fibbonaci and ema line, very interesting.
Thanx Nial, Your selflessness will be re payed as the more traders adopt your strategies and triggers precisely the better the chances of the market moving in the way that you specifically taught….. A brilliant mind is what you are NIal. thank you
Nial – your fakey set up is the best thing i’ve ever learnt! thank you :)
I have been trading on a demo account for a few months now. My strategy has been to chart the high and low on a 1 hour chart and a 15 minute chart. If I spot a trend happening around the high or the low I move in. I have had success doing this. Do you think this is a good strategy? Long term?
Thanks in advance!