Becoming a Successful Trader : The Trader’s Trap

This article in The Trader’s Pendulum Series discusses the Technical Trader’s Trap and what a trader can do to get out of that trap. As a successful trader and coach for the past 30 years, I have had the opportunity to closely observe the top performers in the industry. What I’ve noticed is that although most of them have expert technical skills, technical knowledge alone does not make them high flyers. Learning entrepreneurial skills and cultivating the right habits does.

There is no significant difference between Farah and Stacey (shown in the picture above) in terms of intelligence, education, prior experience, and personal caliber. They are both professionals (albeit in different fields), young, intelligent, ambitious, and highly dedicated to making their career a success.

But there is a real difference in the way they treat trading.

Farah is like the majority of traders, who are caught in the Technical Trader’s Trap. These traders are “hobbyist traders” or “technical junkies”. Meaning, regardless of how many years they have been in the industry, how well versed they are in all sorts of trading techniques, how much training they have received, how much time and effort they seem to be dedicating to trading, and how much money is involved in their daily transactions. They are not the professional players in the trading field, because they lack a business sense in trading.

Stacey belongs to the rare group of successful traders who treat trading as a serious business, and run it meticulously. These are the Entrepreneurial Traders. They truly know what they are doing, have an end goal in mind for their trading business, plan their trades and trade their plans, as well as hold themselves accountable for their trading career. Most successful traders belong to this group — and this is not a coincidence.

These successful traders embrace an entrepreneurial style in running and managing their trading business. Entrepreneurial Traders set goals, plan for their business, constantly review their plans, execute them, and improve themselves. Success can be expected.

On the other hand, average traders are “technical junkies” who trap themselves in the Technical Trader’s Trap, obsessed with feeding on new technical knowledge or trying out new trading systems, at the expense of making a consistent income. How do they move their trading into the passing lane of the highway of success? They don’t know — or they think that they can get there by gathering more and more information.

I have a plan that will help Farah transform herself from a “technical junkie” into an Entrepreneurial Trader and it involves learning the 10 Habits of Successful Traders. My plan has successfully helped many traders that I have coached with their transformation process, and I am confident that it will help Farah too.

Most importantly, it can also help YOU.

If you agree that you want to become a trader or investor who stays out of the Technical Trader’s Trap, then you will need to become a professional (entrepreneurial) trader. Next week’s article looks at the Transformation Process for traders.

I created the FX Trader’s EDGE Coaching Program modelled after the “10 Habits of Successful Traders”, which is the title of my newly published book by Wiley.

Excerpted with permission of the publisher John Wiley & Sons, Inc. from The Trader’s Pendulum: The 10 Habits of Highly Successful Traders.  Copyright (c) 2015 by Jody Samuels.  This book and ebook is available at all bookstores, online booksellers, and from the Wiley web site at www.wiley.com.

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