According to his book “Sell & Sell Short”, the notorious writer, educator and stock market trader Alexander Elder writes: “When I put on my first trade ever, the worst possible thing happened. I made money. That lucky break created the delusion that trading was easy. I began jumping into other trades – with a predictable outcome.” 
Dr. Alexander Elder’s focus is on trading stocks. He is not very fond of trading the forex market because he believes that forex is based on an unfair business model. This is why he only dedicates a small section of his book to trading forex and warns us of its fallacies. For example, some of the dealers, referred to as insiders, don’t even enter your trade into the market and play directly against you.
In my personal experience I have also learned that large financial institutions (such as international banks) have the ability to manipulate the market. These institutional traders have been in trading business for so long that they understand where most of the traders stop losses are likely to be located. In fact before 1990’s, trading from the comfort of your home was not even possible as the forex market was not available to the non-institutional traders. You can say that trading forex is a relatively new activity for the individual traders, but the interest in this market has been growing slowly and steadily since the 90s.
One time, I had a discussion over the Internet with one of my brilliant friends (he is one of those people who tend to never be wrong). It was a time when I was buying my first house. Obtaining a real estate property is a serious business. At the time, I knew little about the interest rates, market conditions and signing mortgage loans. Eventually I found out that according to the terms of my loan I could not refinance my house in the future. I told my friend that I learned these lessons the hard way. To which he responded, and said that the hard way is the only way to learn anything. Relatives or close friends with more experience can make recommendations to go for great offers and deals, but in the end, unless we have experience with that something, we will never understand the reasons for why a good deal is a good deal. Do you want to depend on what other people tell you all of your life? Or do you want to take high risks and come out of a particular situation with experience that was learned the hard way? We will suffer if we jump into the fire, but when we come out of that fire, alive, our knowledge becomes solid as a rock and will last a lifetime.
I have started to trade forex in late 2008. Like many other excited traders I started to trade without knowing much about this market. I would draw trend lines and think I was in business. I thought I was going to make it the first time. I disregarded any technical analysis indicators but my charts were amassed with lines that formed triangles, channels and trends. Yet I was naïve enough not to spot an obvious “head and shoulder” pattern, let alone know how to trade it.
Learning to trade forex has taught me many things. You see, I am naturally a disorganized person. I‘m usually in a rush and there are always a lot of things on my mind. I always do as much as I can, thinking the more effort I put into something, the better my outcome will be. For example, I have several websites, including this one that I constantly update and edit. Several other websites generate passive income from targeted Google advertisements. Having to manage these websites requires patience and a hard-worker’s ethic. However, I constantly switch my focus from one project to another, especially when I notice that my efforts are not being paid off after a long period of time. Putting in so much work into something without eventually seeing results can have devastating effects on one’s confidence about carrying out goals.
As I continued to learn to trade forex I was focused on making a lot of money, just like many other traders. Numerous attempts have led me to blow holes in my account. I knew I was doing something wrong. I also knew that there has to be a way to achieve the level of knowledge and experience needed to trade forex comfortably and profitably and I was a long way from it. After all, so many books have been written about this subject. There had to be people who understood this market and what it took to take profits from it. I realized that a change had to be made in order to stop losing so much money. And eventually, it happened. Looking back at my early trading experience, I can see now that over the past several months studying forex, I was in a boot-camp. While I continued to make bad decisions and lost even more money, it was like paying for a semester in the school of hard knocks. By taking high risks and trading in a live account without prior knowledge of the market, I gained experience that a trader who had less guts than me could only dream about.
I knew what was on the line - my trading account that I funded with hard-earned money working as a Software Engineer, downtown San Francisco (the melting pot of the software industry). Many of my friends know that I am a risk taker. I left my job to trade forex, with little experience. While I categorically refuse to give you advice to do the same thing, you can avoid making the same mistakes I did and learn from my experience. This is an important element of being a successful trader – the ability to learn from other people’s mistakes (and successes, too). Many amateur traders are of the male gender and believe that they have what it takes to become a profitable trader. Many women know that men have that drive and the feeling of power, but will often fail to admit a mistake. This is not to suggest that all men are like that, but I believe that overriding this psychology with commonsense thinking and replacing it with proper, realistic decisions can make a big difference in trading performance. Had these all-knowing people revealed their forex trading balance sheets, their real situation would become obvious. In this business it is easy to hide your performance and anyone can say anything they want. The business of trading forex is notorious for traders lying to themselves. Push your ego out of the way and don’t hesitate to learn from other traders who have gone through the fire for you. Not everyone has to walk on hot coals in order to learn.
Knowing that I am financially dependent on trading forex and that I have no prior experience with this market has created a fear that I could not control or avoid. This fear has eventually contributed to decreasing the odds of my success as a trader. I was placing trades that had low probability of success. As I continued to fail, this fear became bigger and I was no longer able to make rational choices.
I have fallen several times in this market. But what came out of this experience was a surprise. I have become much more organized and self-disciplined not only in trading the currency markets but in personal life as well. Unlike Dr. Alexander Elder, my first trade ever was not a success, but perhaps it was the greatest thing that has happened to me. I learned, the hard way, that trading forex is not an easy thing. And in the future, I will not make the mistake of thinking that trading is easy. I learned that I had to push myself to my limits and take risks in order to simply learn how the market works, let alone reap profits from it – the initial intention that I was blinded by.
Today, the quality of my trading decisions and risk management is top-notch. I have decided to build this website in order to let everyone else know about the exciting opportunities of trading forex. If one approaches it with the right mind, the right psychology and the willingness to learn, I have no doubt that this person will become a successful trader.
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