Why should a swing trader always have a long term strategy?

Note: This article is written by Jonathan from the blog "live forex trading" who is a swing trader in the currency market and who shares his 10 years of experience on his blog. So it's him who speaks from now on. When I first discovered forex in 2004, it was like a giant casino with the opportunity to make many great moves. I was already seeing myself as a millionaire within a few months with a lot of enthusiasm. Then fortunately the years went by to bring me more reflection and humility. Here is what has changed and why you should always have a long term plan and vision for both your capital and your trading.

Having a long term vision to trade with detachment

A big difference between a novice trader and a seasoned trader will be the commitment to a particular trade by playing the game over and over again in a state of regret and disappointment. Over time, detachment makes it easier to do what is necessary, which is to look at what the mistakes were and what improvements can be made to move on. With a long term vision, each trade loses its importance and allows the trader to remain more serene while waiting for the next opportunity that comes along. The novice is going to miss the timing - that's the problem with the lack of vision where each trade takes on an inordinate amount of importance! The most important thing will always be your average performance and not the strokes, this is where your technique needs to improve.

See things in the long term to build good money management:

Beyond technique, a key aspect of the evolution of your capital will be your money management in order to properly calibrate your risk per trade. If the risk is very low, your capital will evolve only very slowly. At the other extreme, if the risk per trade is 10%, your capital will grow very quickly as will the risk of bankruptcy! This calibration is very important so that you are comfortable with your results and that the risk adapts to the distribution of the results of your trading system. For more details on this subject, you can read this article on my blog: "How to build your money management? ยป

Have a long-term vision to better adapt to the market:

Whether it's forex or any other market, there are times when it doesn't move much and other times when volatility explodes. It's in these moments that it is possible to make a lot of money as the market gives a lot of opportunities. Looking at these results over the long term, it allows you to benefit from the different market conditions. It's like a taxi driver who would like to earn the same amount every day when some days will be much easier because of an event and an influx of customers. It's the same with forex where some days the market offers little with little movement and others where it's much easier to take profits as volatility is there. You can see that the interest of a long term vision is not reserved for investors who choose a stock to keep it over time like Warren Buffett, but that it applies to every trader. This is the only way in which the real development of your capital will take place. This is the opposite of beginners who take inordinate risks and then go to the forums to talk about a forex scam without acknowledging that they are doing things wrong.

Plan du site