Ok, nice first question then from Peter below - if you would like to ask anything then please use the comments link at the bottom of this post.
Ive had a real struggle with accepting that the forex is a neutral market and that anything can happen, in fact, so much so that i flip a coin every time before entering a trade to remind me i have as much control in predicting heads or tails as i do in getting the market to do what i want or predict. As tedious as that sounds it helps me to not take the loss personally and to keep my psychology in check.
Am interested in knowing what it took for you in your trading walk to switch your psychology to that of a winning mindset.
And yes i am a 1 year old trader trading $1 lots however sod it, I've learnt enough to realise that the key to being successful is by thinking probabilities and not searching for holy grails of signals and indicators.
Hi Peter, and thanks for the question, it's a very good one
Firstly if you are a year in and still at $1 a pip then well done, you are demonstrating that you have two of the most important things needed in a trader - Firstly determination in the fact that you've managed a year, and secondly discipline in the fact that you are still playing with minimum lot size.
Many traders would have a) given up by now and b) if they had not given up then they would have blown the account by trading higher and higher. You are probably already in a 20% minority so pat yourself on the back.
The lesson to be learned there is that if you cannot make money at $1 a pip that you will not make money at $10 or $100 a pip.
The revelation that you cannot control or predict the market is the most important one you will ever learn. and you can only learn it from the experience. No matter how many times you read it in books or articles makes no difference at all - to actually make it part of your belief system you have to prove it to yourself. It seems you are beginning to get there.
When you know for a fact that you cannot predict the market all sorts of wonderful connections begin to form in your head. How can you possibly beat yourself us for 'getting it wrong' if you had no control in the first place?
so, your question was how did i move into a winning mindset - the answer to this was in your next sentence - knowing the probabilities.
A winning trader can tell you exactly what the percentage of wins they have is. they can tell you exactly how many consecutive losers they expect, exactly how many pips per trade on average they expect and exactly what their average month has been for the past year.
Think about this - if you knew that you won say 60% of the time, that your winners were bigger than the losers combined - that even if you had a bad run that the method over time would bring you out a winner - how would your mindset be?
The important thing here are the words 'if you knew' - Most traders don't know. They don't do exhaustive testing and monitoring to find out these things. They have a feeling that they do OK and that their method works - but they don't actually know it for a fact because mostly they can't be bothered to do all the testing and logging stuff.
When things are going well it's fine not to have the tests that prove beyond doubt that you win - because you are winning anyway. But when a bad run comes along their belief is shattered and they start changing this and that, convinced now that their method does not work. Maybe it doesn't - but then maybe it does - but because they did not put in the testing they will never know.
These magic words 'winning mindset' bring up all sorts of pictures of the successful businessman in his suit, striding along without a care in the world. Traders aspire to be like that yet do not want to put in the work.
Having a winning mindset is akin to putting you feet out of the car after a journey - you know for a fact that there will be ground under your feet - you don't know if the ground will be muddy, quicksand or good solid ground - but you do know that if it is muddy and slippy that if you continue to move around you will get to solid ground. You know this for a fact because you learned as a child.
Of course there is always the chance that you will step out into a gaping chasm - but the probabilities are stacked way in your favor that ground will be there. even so, to make sure you aren't going into a chasm you always take a glance- and a check. winning traders do the same thing, constantly checking their perception is right.
When you take trades day after day unless you test those trades, log them, analyse them and explore them then you don't know that there is ground beneath your feet and you won't know if the ground is moving.
In the trading world you are a child and you have lessons to learn. but just like a child learning not all your lessons can be simple and some require work on paper.
A winning mindset comes from actually knowing that your method works and that the probabilities are in your favor. You have proved it by doing lots and lots of work.
A winning mindset comes from knowing that you can repeat your trades over and over again in a systematic way. This is why I've always tried to get away from discretionary trading - how can you repeat a gut feeling?
This is the real work of the trader. Being a trader is not about pressing buttons at the right time and watching charts - the real work of a trader is done way before those trades are placed. The real work of a trader is being hung over a spreadsheet for months on end and checking checking checking against a one minute chart. A trader with a winning mindset has done all this before trading and just has to go through the motions.
Once the work is done THEN comes the payback. The trading is easy - just button clicks without any emotions - repeatability again and again - then comes the rewards.
Forget learning to trade - trading is merely the process of clicking buttons.
Learn to test, log and analyse instead and the winning mindset you desire will automatically come.
Hope this helps