Best ways to motivate yourself to trade Forex

Best ways to motivate yourself to trade Forex

Beginner traders often overestimate their potential returns from Forex trading. Most of us start the trading journey with the first impression that it’s an easy way to make a lot of money. However, soon we realize that profitable trading with consistency takes a lot of work, time and energy. 

It’s common to feel down and unmotivated after a losing trading session, but it’s important to keep in mind that losses are a part of the trading process. Typically after losing money traders start to underestimate Forex trading. Some even go as far as calling Forex trading scam. In reality, there are a million ways to make money in the world, and financial trading is certainly one of them.

Traders need to stay motivated in Forex trading and keep executing, and upgrading their strategies to remain ahead of their competition. Motivation can be a key factor in trading currency pairs successfully. Here are some of the Forex trader motivation tips to keep trading:

  • Set clear goals: firstly, it’s best to define clearly what you are going to achieve. Make your goals measurable, specific, achievable, time-bound and relevant. For instance, having a goal to double a trading account every month is very difficult to achieve and is mostly unrealistic. It’s more realistic to aim for 20-40% annual returns. Having clear goals will help you focus on certain areas and create a sense of purpose. 
  • Learn about currency trading more. The more you know about currency trading the more confident and motivated you will be. There are various great sources of information, such as the guide you are reading right now. There are lots of great books on trading such as: “Trading in the Zone ” by Mark Douglas, “The Complete TurtleTrader” by Michael W. Covel, “The Art of Currency Trading” by Brent Donnelly, and others. Moreover, you can attend webinars, seminars, and stay up to date with the latest developments in the market.
  • Create a trading plan. Having a trading plan is essential in trading. Having a structured set of rules in place makes the trading process stress free as the decision-making process is much easier. Having a trading plan in place can help you stay focused and disciplined. 
  • Practice using your demo trading account. Practicing using a demo account can help you become more experienced in trading and gain confidence. Having confidence in trading is essential as it helps overcome fear of placing an order. 
  • Keep a trading journal. Trading journal will help you become a better trader. Keeping track of your decision making process will make it easier to spot your weaknesses and strengths and help you progress. And progress equals happiness. When people feel like they are making progress towards their trading goals, they experience positive emotions such as pride, satisfaction, and joy. This can help boost motivation and overall well-being. 
  • Join a trading community. Joining a currency trading community will help you increase motivation and gain new trading ideas. In addition, connecting with other traders brings additional support, and knowledge.
  • Reward yourself after achieving the milestones towards your goal. This can keep you motivated and give you a sense of accomplishment along the way. Rewards can be anything from a small treat to a larger purchase or vacation with family and friends.

Benefits of currency trading

There are many financial asset classes and many different approaches to trading. Some traders fail to profitably trade one market while they have great results with another. In case you are becoming skeptical about Forex trading, here are some major benefits that comes with currency trading to consider:

  • Foreign Exchange market is highly liquid. Trillions of dollars are being traded daily. Currency markets are the most active in the world. This means that buying and selling instruments is much easier and there are low trading fees such as spreads (difference between bid and ask price).
  • Forex traders can use leverage to increase their purchasing power. This feature enables currency traders to speculate on financial markets even with a small amount of capital. However, it should be noted that using a high leverage can lead to increased profits as well as to increased losses, which is why it’s important to use leverage with caution.
  • Currency trading is available 24 hours a day, 5 days a week on workdays. Currency markets are decentralized, this means that you can buy EUR/USD during London trading sessions and sell during New York trading hours. 
  • Currency trading comes with low trading fees. Forex trading has become highly popular globally. And the number of Forex and CFD (Contracts for Difference) brokers is increasing each year. This increases competition and traders get tight spreads and low prices. In addition, registering and account opening is very easy. And many brokers do not even have any minimum initial deposit requirements.
  • Forex trading allows traders to diversify their portfolios by trading different currencies. This can help spread risks and increase potential profits. 
  • Foreign Exchange markets are known for being highly volatile. And volatility can bring trading opportunities. 
  • Information on currency pairs such as economic data and political news is easily accessible on the internet. In addition, there is lots of quality educational material that you can use to advance as a trader in this field. 

Currency trading might not be for everyone, however, it brings some great benefits that makes the Foreign Exchange market attractive for both investors and speculators. 

Biology of Motivation

In order to get motivated to trade Forex, it’s important to learn about biology behind motivation. Motivation and dopamine are closely linked. Dopamine is a type of neurotransmitter that is involved in the brain’s reward system, and it plays a major role in motivation. When humans experience something rewarding or pleasurable, dopamine is released in our brain naturally. And this reinforces our desire to seek out similar experiences. 

Research has shown that dopamine is involved in a wide range of motivational behaviors, such as seeking food, social interactions, and substance use. In addition, dopamine has also been linked to more complex forms of motivation, such as the pursuit of long-term goals and the drive to explore and acquire knowledge. 

It should be mentioned that dopamine is not the only factor in feeling motivated. There are other factors, such as environmental cues, past experiences, and social influences. 

Managing Forex trading motivation and human feelings accordingly is critical in trading successfully. Traders are influenced by following emotions: 

  • Fear: Fear of making a trade is very common after experiencing a loss in the market. As a result, traders often lose motivation to keep trading. To counter the fear of trading, you can start trading using demo accounts or reduce your trading size until you get winning trades again. Every trading strategy can experience losses at some point, in investing this is known as the drawdown period. Managing drawdowns is crucial for trading profitably long term.  
  • Greed: greed can manifest itself in trading in a variety of ways, such as taking excessive risks, and making impulsive decisions based solely on the potential for huge profits.
  • Revenge trading: desire to revenge trade often comes after losing money in the markets. To counter this feeling traders put limitations on themselves. For example, if a trader loses 3% of his entire trading capital in a day, he will stop trading that day.
  • Hope and laziness: when traders are too lazy to create trading strategies, have a trading journal, test and backtest their strategies, they simply gamble with their money and hope that everything will be great. It’s important to note that every highly successful trader is a hard worker. 

In order to increase motivation towards financial trading, first you need to search for ways to limit dopamine production on activities that are unproductive. This phenomenon is known as a depomaine detox. For instance, it’s widely known that sugar, unhealthy foods, watching TV, etc. release dopamine in our brain. It’s important to replace unhealthy activities with activities that can advance your health and financial stance. The best way to achieve this goal is to set measurable long term goals, break them down into steps, and reward yourself after accomplishing each. In addition, it’s best to get Forex trading inspiration from successful traders. Learn their stories and approaches to trading and life. 

Key takeaways

Staying motivated in FX is a key factor for successful trading. Traders can use various ways to increase their motivation, such as setting clear goals, learning more about trading, practicing more on demo, creating a trading plan and trading journal, joining a trading community and rewarding themselves after achieving the milestones towards their main trading goals. Currency trading comes with many benefits compared to other markets, such as liquidity, leverage, low trading fees, and more. Traders can use the biology of motivation to their advantage by limiting dopamine release on unproductive activities and setting reward systems towards their main trading goals. 

FAQs on Best ways to motivate yourself to trade Forex

What is Forex trading motivation psychology?

Finding motivation to trade FX is difficult after losing trades. Here are some key components of FX trading motivation psychology, including: emotions, beliefs and mindset, self-discipline, goal setting, learning and growth, risk management, and trading community and support. 

What are the best tip to motivate yourself to trade Forex?

Some of the best Forex trading motivation psychology tips include:having clear, measurable and achievable goals, preparation, surrounding yourself with like minded people that support you and rewarding yourself for achieving milestones towards your bigger goals. 

Where is the best place to learn how to motivate yourself to trade Forex?

Finding motivation when trading Forex can be difficult sometimes, especially after losing trades. The best place to find motivation is within you. When you are in doubt, remember why you started the trading journey and how much you have already learned. In addition, communicating with other traders can help boost your motivation towards trading. 

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