How to Set Forex Trading Goals

It is important to have rules and goals when trading the Forex. In fact, the more structure, rules, safeguards and principles you have in place and in action the greater your chance of success. As soon as you start trading without thoroughly contemplating each aspect of a trade, that is when you will start to deteriorate.

Let’s face it, if you cannot trade for an allotted period of time with a rules-based system in place and meet certain goals or criteria then we must admit that there is little or no reason to continue trading. Many people claim to be Forex traders but few are genuine when held to certain standards. The only way to reach long term success in Forex is by meeting goals.

There are three main aspects to setting a Forex goal. Firstly, your goal must be realistic. If your goal is to make a million dollars in a short period then that is probably not immediately realistic. If your goal is to double your money each week that may sound great but it isn’t likely. Try to find something that is more attainable. Start with making 10 pips a day for 60% of the trading days in a month. That means you will be allowed some losing days but if you succeed you will have a measurable level of achievement.

Secondly, your Forex goal must be attainable. Don’t set your daily goal for 20 pips if you have trouble even making one successful trade. Instead, work to a workable level in your trading. Try to make your first goal a small one, like telling yourself you will try to make at least four wins out of the next ten trades. This can later be increased to five and later maybe to six. In any event, if you can work up to smaller goals your chance for success is that much more certain.

Lastly, your goal must be measurable. You need to find the characteristics of a successful Forex trader such as wins are bigger than losses, profitable after 100 trades (then 1000) or winning percentage greater than 50%. These things are common among profitable traders and should be things that you work to as well. It means nothing if you have one week of success if your Forex trading system hasn’t been tested in all market environments. You should prove to yourself through baby steps that your trading method works. This is the only way you can consider yourself a successful Forex trader. An athlete’s greatness is not measured in one performance and the solidity of a scientific theory is not proven by just one test. Build confidence in your trading ability by staying rational, consistent, logical and disciplined.

In conclusion, success is something that most people in a given industry can easily recognize over time. You need not be rich, have an MBA from Wharton, or have years of experience to be successful in Forex trading. The truth is, most Forex traders started out small. They did not trade more than they could safely risk (1-3% risk per trade maximum), they developed a Forex trading system that worked (over time) and ultimately, they learned from their mistakes. Make a rules-based trading system based on logic and discipline, make small, realistic goals that can be measured over time and take things step by step and you will be certain to succeed.