Perhaps the single most difficult personality trait to learn as a trader and investor is patience; the patience to wait for the right time to enter a trade, the patience to hold a trade, and the patience to determine the right time to exit a trade. A patient Forex trader endures the ups and downs of the Forex market with forbearance, with the goal of a steady return on investment.
Patience For The Entry
Technical traders use various indicators, trend lines, pivot levels, or other analysis tools to pinpoint the level to enter a Forex buy or sell trade. Sometimes, the ideal entry level is just 10 pips away from the market price and sometimes it is further away. Once you’ve identified the level you want to enter the trade, the anticipation to take the trade builds. This is where impatience sets in. Instead of waiting for the Entry Point price level, you decide to rush in so as not to miss the trade. This impulsive decision may cause you to enter a trade that goes against your strategy or trading rules, simply because you did not have the patience for the Entry Point level to confirm.
Impatient trades who violate their trading criteria or lack self-discipline leads to a panic when the trade goes the wrong way. Panic = emotional trading and bad decisions. Keep emotion out of Forex by having the patience to wait for your Entry Point.
If you are tempted to enter a trade before it is time, take a step back and review the reasons you chose that Entry Point in the first place. Patience involves having the self-discipline to hold back from entering a trade impulsively.
Learn more about the psychological dangers of emotional trading.
Patience To Hold
It is gut-wrenching to wait patiently for an Entry Point to confirm, and then you enter the trade at the exact price you wanted, and then immediately you watch the trade go the wrong way. It is especially excruciating if you see a small profit, and then it goes the wrong way. It is tempting to pull the trigger immediately to get that trade closed before there is more damage. But by impatiently closing a trade too soon, you may miss out on a profitable trade.
Or, if a trade enter the right direction immediately and you see a profit in your account, it is tempting to close the trade out too soon with a small profit. Then later you look back and wish you left the trade alone when you realize you could have banked larger profits.
The point: Successful traders set their stops and take/profit limits to give the trade enough room to breathe without jumping impatiently to close the trade at whim. It turns out that when your well thought out plan or strategy is correct, the final ingredient is the patience to see it through.
Patience To Exit
Patience does not mean stubbornness. Cultivating patience means that you can analytically step back from time to time and re-assess your trade with fresh eyes. Is there a huge market-moving release coming up? Is there a reason to believe your original criteria for being in the trade in the first place is no longer valid? Patience is the ability to stay calm and tolerate a difficult circumstance, or in this case a possibly difficult trade, and analytically decide if a trade needs to be terminated early. This decision is not based on whim or emotion, but based on good sense and strategy. If there is solid reason to be out of the trade, then a patient trader can calmly make the decision to exit the trade and move on. Or if your analysis shows that your trade is still valid, then patience will help you continue with your position.
Patience With Forex Signals
ForexSignal.com subscribers receive signals in form of Entry Point. We do not place market orders, but entry orders. Sometimes it takes even up to a few hours before an Entry Point price is reached. Remember, patient traders create their Entry Order, then patiently wait for the price to fill. By jumping in to a trade at market price can set you up for a loss. Although these trading opportunities occur often when you least expect it, there is no need to be glued to your Forex platform. You can patiently continue with your life knowing we are monitoring the Forex market and we will alert you when it is time to trade. Or, if you use our Trade Copier, then the trade is sent directly to your Forex platform without you having to do any work at all.