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Nial Fuller

Professional Trader, Author & Coach

Winning Forex Traders Vs. Losing Forex Traders

winlossTwo traders can use the same exact forex trading strategy yet one of them makes money consistently and the other loses consistently. To what can we attribute these seemingly perplexingly different outcomes? There really can be only one variable that is different if the trading strategies and everything else is exactly the same. The difference in the outcomes can be explained by the fact that a winning forex trader thinks fundamentally differently from a losing forex trader. That is to say, that the difference between winning and losing forex traders is entirely in their heads. This article will discuss how a winning trader thinks about various aspects of forex trading vs. how a losing trader thinks about them. Hopefully, you will gain some insight into what you are doing wrong and how to fix it as a result of reading this article. Enjoy!

• Realistic expectations –

Winning traders have realistic expectations about how much money they can logically make in the markets with the amount of money they have to start with and they don’t think they will get rich quick. This mentality actually helps them make more money faster because they don’t make the emotional trading mistakes that losing traders make as a result of trying to control the market by over-trading and over-leveraging their accounts.

Losing traders typically have unrealistic expectations about how much money they can make given the amount of money they are trading with. Many traders come into the forex markets thinking they can deposit $250 into their accounts and turn it into $10,000 in a few months. Having this mentality is going to naturally make you risk too much and (or) over trade, which will eventually cause you to lose money even if you get lucky for a while and hit a few big winners. Having realistic expectations about how much money you can make each month given the amount of money you have to trade with, while practicing effective forex trading money management, is a crucial component to successful forex trading.

• Managing risk –

Winning traders know how to effectively manage risk, they are comfortable with losing the money they have on the line and this allows them to trade emotionally detached. Losing traders typically begin with good intentions regarding risk management, but it all goes out the window once they hit a few losers OR winners. Winning traders know how to continue managing their risk no matter how many losers or winners they have in a row. They know that every moment in the market is unique, and essentially anything can happen at any time, this causes them to be consciously aware of the error of over-leveraging their account just because they think they stumbled onto a “sure-thing” trade. Winning forex traders never trade with money they can’t afford to lose, while losing traders often trade with money that they shouldn’t be risking in the markets, this causes them to worry about their trades and to be in a constant state of overly-emotional trading.

Losing traders by definition do not know how to manage risk effectively, they might say they are comfortable losing the money they have on the line for any given trade, but secretly they are mentally fixated on their trades and cannot stop thinking about them, sometimes even staying up all night staring at the computer screen. Losing traders react to each winning or losing trade they have by trying to control the market through the amount of money they risk or by trading too much; if they win on a trade they will typically risk more on the next trade out of euphoria or they will start over-trading because their confidence is up, when they hit a losing trade they will again jump back in the market and over-leverage or over-trade their accounts in a vain attempt to “make back” the money they just lost. So, in essence, losing traders do not have the same emotion-control mechanisms that winning traders have, or rather that they have developed, these emotion-control mechanisms are basically conscious patterns of thought that are formed out of discipline, they keep winning traders in check after each trade they win or lose, thus eliminating the emotional mentality that losing traders possess.

• Taking profits –

Winning traders take profits with a pre-defined strategy, losing traders don’t take profits, or they take small profits compared to their losers. Winning traders understand risk to reward and how it is the key to making money in the markets. A trader’s main job is to manage risk, not to take profits, profits come naturally if you understand risk to reward and how to properly maintain your poise and manage your risk on each trade. This includes not “meddling” in your trades when it is unnecessary, and taking a set-and-forget forex trading mindset. Winning traders know that you must believe in your trade, they know that you are the most objective and level-headed when you are NOT in the market, so if you plan your trades while you are flat the market there is no sense in messing with them once they are live because you won’t be thinking as clearly as you were in the planning stages.

Losing traders take small profits relative to their risk, they do this because they don’t plan their profit taking strategy prior to entry, and they also usually risk too much so they are more likely to take a premature profit or close a trade out at break-even because they are over-analyzing it from being worried about losing the amount of money they have on the line. When you take a profit that is less than what you have risked on a trade, you essentially make it very difficult to succeed because you are putting yourself in a position to be required to win on a high percentage of your trades in order to make money. Winning traders know that they only have to win about 35-50% of their trades to make money consistently because they understand risk to reward ratios and they know that taking anything less than 1 to 2 times your risk on a trade is simply counter-productive to a long-term profitable forex trading strategy.

• Trading strategies –

Winning traders know simple strategies like price action trading work best because what really separates the winners from the losers is how well they manage their emotions and remain disciplined, not having a super-complicated or fancy looking trading strategy. Therefore, winning traders know there is no sense in over-complicating one’s trading strategy when you can learn to trade with a simple and effective method like price action. Winning forex traders master the setup(s) they trade, one at a time, as a result of this they know when to trade and when not to trade. Losing traders jump the gun because they don’t master their setup(s); they switch from one strategy to the next on a never-ending futile search for the “perfect” trading strategy that will allow them to win on nearly every trade.

Winning forex traders know they must develop and implement a patient mindset with the trading strategy they use, as a result they don’t rush any trade, they let the market show them its cards, instead of trying to “out think” or control the market. Losing traders typically manifest trading setups that aren’t really there, they over-analyze the market and try to digest as many market variables as they can in a vain attempt to predict what will happen next, once they convince themselves they are right about market direction they will risk too much simply because they think they have covered all angles and they can’t possibly be wrong. Winning traders know that the market is an untamable beast and that the only variable they can consciously control is how they react to what the market offers them. Price action trading gives winning traders a high-probability entry method so that when the market shows them its hand they can take a trade setup with confidence and clarity because they have been patiently waiting instead of actively over-analyzing.

Nial Fuller is considered a leading ‘Authority’ on Price Action Forex trading strategies. If you want to learn more about harnessing the power and simplicity of Price Action Trading Strategies please visit Nial Fuller’s Forex Trading Course & Traders Community Page Here. Nial’s Students get lifetime access to all of his advanced price action Forex Courses, video lessons, webinar tutorials, daily trade setups newsletter, live trade setups discussion forum, traders support line & free ongoing course updates. For more information visit the Forex Course page here.

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Nial Fuller

About Nial Fuller

is a Professional Trader, Investor & Author who is considered ‘The Authority’ on Price Action Trading. His blog is read by over 200,000+ followers and he has taught 25,000+ students since 2008. In 2016, Nial won the Million Dollar Trader Competition. Checkout Nial's Professional Trading Course here.
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  1. Gideon

    A lot of really insightful info on here, good to know that practicing mindset can be so valuable

  2. Galen

    Hello Mr. Fuller

    Managing Risk and Reward, managing emotions, managing time spent analysing charts, managing one “Price Action” setup at a time, manage to stay with your trading method, manage to let go of trading if your setup is not there, ect. ect. ect..

    I am beginning to wonder if there is a key word that is used in your articles to express how important it is to to to god I have the word on the tip of my tongue; oh well somehow I’ll manage.

  3. Jason Tay

    Hi Nial,
    Happy new year 2011 to you.
    I write to show full support of all your fx articles.
    Thank you very much for all these good articles.
    I have learnt a lot from these articles!

  4. Akpos

    I must confess that u have been a good caution to me in maintaining the right mindset for trading…

  5. Abdul Rahim bin Mohamad Taib

    Thanks Nial.What you said is true.I think it all boils down to patience.Trading fx is not a get rich quick scheme.Casino is the place if we want to get rich quick or it could be the other way round.

  6. frank

    All the while, i have been receiving your emails and learning the lessons so well. i just want to thank you. i hope to buy your book soon as i am thinking of taking you as my mentor in trading!

  7. Arnold

    As always Nial, your articles and commentary always express the realities of trading properly and with a simplified approach in the clearest way possible. Discovering your course and methodology has made a tremendous impact on my trading mentality. I hope to start seeing more videos from you soon, maybe presenting coure highlights and even commentary. Have a wonderful New Year!



    You are an amazing forex phycologyst, everything you said is on the money. Thankyou so much for your knowledge, and I am saving for your course now, cant wait.


  9. Sher

    This article hit the nail on the head, it’s telling things that you do know, but, sometimes forget because of the wrong mindset. Thank you Nial

  10. Vijju

    Hi Nial,

    Wonderfully explained. Right now after going through your article i have undone a lot of my bad habbits in my trading.. still a long way to go for me.. By reading every weekly article it make me stronger..

    Thankyou so much

  11. Wolfram

    Thanks for holding this mirror. I intend to use this as a “turning is learning” strategy for myself.

  12. David

    Thanks Nial – good, sound advice as always.

  13. Craig

    Good stuff, I have a splitting headache & still get it. LOL

  14. Mgp

    afforable to loose and expecteg a huge profit in a short time will lead to danger . This article gives us a very clear picture .. thank u Nial . U r great

  15. Mgp

    What you said about the leveraging mindset shown to the small account is absolutely true. Newbies have a tendency that by putting a small amount that is

  16. Hari

    Dear Nial,
    Your lesson is very good and website is useful. I made the mistakes what loser traders do like what u said. made money by over confident lost all money in one trade. I feel some confident now to built again. Thanks for ur lesson its much appreciated.

  17. Tony.

    This is a good article and clear to all who have traded.
    Self discipline/ emotional discipline takes time to develop through trading in the markets.

    I can say that my trading has turned around recently through taking a couple of steps back and stop trying to force and fight the market and by trading less with higher time frame price action setups.

    Trading is fun when you have a plan in place and wait for your set-up before you enter the market. Most of the times you win well and your patience and discipline are rewarded with a profit, and those trades that don’t pan out, well what the heck it does not have to effect you emotionally, just move on to your next setup, right…

    Keep you emotions and self discipline in check and the market will reward you with some great profitable trades.

  18. larry

    Great article!!Kepp it up!!!

  19. Stuart

    Hey Nial,
    That was an awesome article and a very explicit representation of how to/not to approach forex trading. Keep up the great work with the website, its much appreciated!

  20. Trinu

    Thanks Nial
    Another great lesson.. Thanks for ur christmas special offer.. I am also newbie will join soon..

  21. eric granatha

    thanks a lot for the lesson. It’s all easy to understand.
    Yes now i’m try to throw away my old habit.

  22. prince

    I am newbie. Thank you for the article. I am still learning
    about risk/reward. Having said that reading above has enlightened me tremendously. Thank you very much. You have been of immense help.As ever. Prince

  23. rani

    thank you for this wonderful lesson.

  24. Phil

    This type of quality free content is what convinced me that Nial has something well worth the investment in his course. I made that investment a few days ago (thx for the Chrissie special discount Nial :-) ), and now have a genuine reason for opening my charts on Monday. I will finally know what I am looking for!

    Many thanks from a fellow Aussie.

  25. ebi

    Thank you for your free lessons. you have added a lot to my arsenal and reminded me of the important things that i was overlooking like price actions. once again thank you. i hope to start trading again very soon and i will tell u how good my trading is. please teach others how to use trailing stops. i have been using it for over a month now and sometimes a get up to 800pips using a 0.10 lot size.

  26. Vitalie

    Hi Nial, greate article. I learned a lot since I read you articles, thank Nail.

  27. lisa

    As a very new to forex person, I find this lesson grounding and confirmation of my own thoughts and patient mindset. I am educating myself in a career I can be successful at and I look forward to learning and becoming a master at this.
    Thank you, Nial for all your great website.


  28. Warren

    Seems like every time I read something you write. It seems to pertain to me.
    Its like HE KNOWS!
    Keep it coming. You will get me straightened out sooner than later.
    Yea old habits are hard to break. Wish I would have found you sooner!!


  29. colin arklay

    Hi Niall
    Been a member for a few months now have a 6 year or so history of trading.mainly losing and reloading my account.
    The usual mistakes it seems ie trading small time frames, no patience ,over complicated trading methods, staring at the screen all day etc.
    Luckily I stumbled onto your website and went straight to the daily charts worked very hard on overcoming my impatience and this is now beginning to pay dividends. I think that your trading approach and philosophy is outstanding and it is great to find a person who cuts all the crap and speaks total common sense.Price Action is what it is all about for me it is simple and it does work.
    Thanks for all your advice Niall
    Keep it coming mate


  30. Giles

    Price Action certainly is simple – The right signals from the right place at the right time coupled with the right mindset to see it all through = Success.

    Thanks Nial for your input

  31. Timsar

    correct and useful !!

  32. Tim

    Nail, keep up with the posts, I’m learning a whole lot from them. Very important to learn these lessons in my trading. Thanks alot as always.

  33. Dave

    Great stuff as always.Will try to implement.Thanks.

  34. joel

    great lesson!

    and great course and forum too


  35. tey hock seng

    Nial, i like your articles very much. They are very meaningful to me. Please write something on currency options, as that may help in managing risk.

    Thank you from the bottom of my heart.

  36. T Allen

    Another Great Article Nial – THANKS. Hope you and your family are doing well during this Christmas Season and that you have a Merry Christmas and Happy New Year.

  37. aminu iliyasu

    i enjoyin reading youe newletters,just hoping to meet you soon.

  38. Alan

    Good article.

    I think it takes some time before a new trader will understand what your saying but if they just stick with trading and keep reading stuff like this and dont give up to early it will all become clear.


  39. victor

    You are such an inspirational person. Taken on the article of winning and losing forex traders, when i read it, i have know how to place trade in terms of risk versus reword. keep it up thank you Nial
    GOOD WORK!!!

  40. Sam

    As always,spot on with the mental stuff.
    I am reading as saying…. Yep,i know what you mean.
    Now i am using PA and trying to undo old habits.
    PA definately gets better results,the only problem i find is
    that trades are fewer and during the time waiting for the next setup,i look for setups that are not there.
    Gotta work on that.
    Keep up the good work !!!!


  41. KJC

    As always Nial, this post has got top rate, well written content. I like that you tell it as it is. Keep ’em coming. Thanks for all your time in writting and posting the articles to be freely accessed and read.