Fear

Fear in the FX market

Now, it may sound strange, why would a trader be scared? I mean, it’s not like he’s risking his life (Well, make sure you manage your risk…If you don’t then yep… I guess)

A good FX trader executes his trading plan with no fear.

A losing trader does not execute his trading plan BECAUSE of fear

Have you ever not taken a trade because you were scared? Scared of losing, scared of being wrong, scared of not being good enough, scared of losing money, scared of what other people will think of you etc?

Hell, I have…

The main idea behind this blog post comes form the book “Way of Warrior Trader” in it there’s a great section about fear

According to the author – there are three instinctual fears: fear of loss, fear of pain and the fear of the unkown

I mean, why are we scared of getting killed by an alligator?


1- Afraid of the pain you would experience while getting chewed up by the alligator’s jaws

2- Afraid of losing your identity as you’re being digested in the alligator’s stomach

3- Afraid of not knowing where you’ll end up two days later after passing through the alligator’s guts

Way of the Warrior Trader

Makes sense right?

I mean I wouldn’t want to be killed by an alligator (well, definitely would be interesting)…

So why are we talking about this?

(Nearly) all fears we are faced with are either anticipatory or reflective in nature


Fear of the future

We are scared of the unknown, the unknown we are all faced with is the future.

We don’t know what will happen today, and even less so in the markets since we don’t control them (kinda wish we could manipulate them for my own benefit…)

Not being an author I’ll quote the book again because he puts it better than I could:


To render repeated attention to issues that are currently outside our perimeter of control is a waste of life force and a distraction away from the situations we do have an element of control over in the present moment.

Way of the Warrior Trader

Instead of being worried about what will potentially happen in the future, focus on what you can control – and that is the execution of your trading plan.

So what are a handful of tips to control your fear when it comes to placing a trade?

1- Forecast every single morning, and only take the trades you forecasted

2- Have a trading plan – and know the strike rates and expected return every set-up has

3- Backtest, that’s the only way to do the first two points, so keep backtesting

4- Focus on your breath – try to breathe deeply into your abdomen, it’s linked with the vegus nerve that will make you more calm (and also reduce heart beat I believe)

5- Meditate (eheh you thought I’d have given up on this one by now) it will make focusing on the present moment and push away all thoughts a lot easier


Scared of success?

Being scared of succcess, may sound like a strange thing, but it happens to a large amount of forex traders and is one of the main reason why traders blow up their accounts

Ed Seykota is a smart dude.

We all get what we want from the market in the long run

The biggest challenge you will face in the FX market is your mental side. Make sure your mindset is in the right place.

Once again, I swear this is (probably) the last time I quote him for this blog post


Nothing can weaken your resolve to follow through with a plan more than the lack of genuine desire to achieve the end result.

Without such a plan, you can be assured that one or more of the four poisons of doubt, fear, confusion and surprise will eventually infect your mind. Effective planning will always help to minimize (if not eliminate) these poisons.

Way of the Warrior Trader

Accept the loss, understand that you don’t know the future and you’re just playing out an edge, take the position and be happy whatever happens next because you executed your plan.

Executing your plan is the goal, ignore the end result.


Cool video by AK Fallible about fear in the market! Love his channel, definitely would reocmmend

Make sure you’re not afraid to take the trade if it fits your trading plan

Yep, a trading plan, backtesting and forecasting is key, what can I say 🙂

By having a trading plan you outsource the trading (to you) so you get to delegate the responsibility! Definitely checkout the last part of that video tho – one of my fav. scenes in Billions hands down ahah


If you think that it’s the mental side that’s holding you back definitely check out the book, I did enjoy it and hit me up with your questions!

I love digging into peoples brains 🙂


Anyway, have a good one, I hope you enjoyed this blog post! Let me know in the comments if you want me to do more post like this!

Onwards,

Forecasting is key

Forecasting, backtesting and having a trading plan are the three pillars of successful in the FX market.

Do you have a forecasting routine? If so, keep it up! (let me know what it is)

If you want to become a full-time FX trader, you will have to develop a trading plan, backtest it, and forecast potential moves.

That’s (more or less) everything you need.


What is forecasting?

Figured I probably should do a quick explanation of what I mean by forecasting…

It’s basically “guessing” where the market will go next and how…

Sounds rather easy right? It doesn’t even take that much time

Forecast for EUR/CAD on the 11th of September

This is my forecast for EUR/CAD, I just drew on trading-view the potential scenarios that could happen, I know there are many other potential ways the market could evolve during the day, but in my view, this is the most likely.

You could use different drawing colors based on “I’m willing to take this scenario” & “Not willing to take this scenario” (that’s actually a good idea, I should do that)


If it’s this easy what’s the benefit

Let me start this section with: I go a lot more in depth with my forecasting process, just scroll down if you already know the benefits

There’s five key benefits for a trader, but I was lazy while building this infographic so here’s 3 key points...

1- It will increase your confidence, you are able to track whenever or not your forecast actually took place, which in turn will increase your confidence in your ability to be a few steps ahead of the market (which is key to be profitable)

2- You’ll be prepared, doing your forecasting is basically drawing out all the possible/probably scenarios – you’ll be able to decide ahead of time what price action you’ll want to see before taking a trade – all you need to do is execute your plan

3- It’s easier to profit, having done your forecast in the morning you are a less likely going to miss a trade during the day since you are able to place your alerts at all the key areas. Plus, it also increases the likelihood of you sticking to your trading plan

And the bonus two…

4- It will decrease your emotional attachment to potential trades, and trades you are currently holding: by drawing out several possibility you know that there is no guarantee that the price will do exactly what you want it to, it doesn’t care, instead it makes you realize, we are only playing an edge

5- It allows you to switch from analyst to a trader.

It’s really important to be an analyst when it’s the weekend and when doing your forecasting, however, when the markets are live, and there’s a potential trade set-up in the making you need to become a trader, not an analyst. Having done the analysis that morning will help you execute.

Here’s a video explaining it if you don’t like reading…


My forecasting process

Now let’s dig into my process, that’s probably why you’re here (sorry for making you wait)

I recently did a tweak so here’s a breakdown of what I used to do and what I do now, not a huge difference, but really happy so far

I used to draw at least three possible scenarios:

  • Two potential entries, so how the price gets there and where I’d be interest
  • One scenario where I wouldn’t be able to take the trade, either the market goes in the opposite direction or just impulses through everything I was eyeing up

That was done first thing in the morning and last thing before going to bed, because that way I would force myself to think about the possible, the probable and admit, the price isn’t necessarily going to go where I want it to

In the morning it was to plan the day ahead, at night it was to have my subconscious think about the market while I was sleeping, and once again, forecast where the price would go over the next seven/eight hours

It was a really cool exercise, but I wasn’t getting the most out of it…

Now I do my forecasting somewhat differently

I use my trading journal to track those morning forecasts (I keep everything in my excel file, from reason to trade, to monthly asr, to journal, to forecasting etc, I like having everything in one place)

Here’s this week example

So to quickly explain, I track the day of the forecast, the pairs I’m interested in, the direction, then three potential scenarios that could play out (out of many), a screenshot of the potential moves + drawings.

Then here’s the addition, I then come back the next morning and figure out which one happened, sometimes it was a fourth option, that happens.

But here, you can see I had forecasted the move 12 times out of 15 – not picture perfect but pretty darn close.

How do you think that makes me feel? How would that make you feel?

More confident in your skill? Yes

Happy because you get to collect more data? Yes

More likely to execute the next time you see a trade set-up? Yes


I highly recommend you to do the same

It takes less than thirty minutes in the morning, yet you have the entire day planned ahead

You know what you want to see before taking a trade – that’s key, it reduces your hesitation to trigger a trade, and avoids you from taking low quality trades

You are also able to be “free” and that’s one of the main reasons people start trading, they want to have free time. If you don’t know what you want to see in order to take a trade you’ll just stay in front of your computer, and basically be a slave to the market.

Don’t be a slave to the FX market: Forecast in the morning

Anyway,

I hope you enjoyed this blog post! If you did, please leave a like or share it? ❤ Would mean the world to me!

Onwards,

Being a DIGITAL NOMAD….

Let’s talk about the highlight, the downside and once there, what happens?

Let me start with, it’s pretty amazing – I mean it. We usually define a digital nomad as someone that works remotely to earn a living and are able to travel whenever/wherever they wish. Sounds pretty amazing if you ask me… But yep, there are downsides!

The highlight:

You get to travel (duh that’s pretty obvious Max…) to places you’ve always wanted to go – well I still want to go to Mars but apparently there’s no wifi there… One day 🙂

I mean Mars isn’t even on this map neither is the Moon 🙂 and I clearly need to do more of Africa & Asia

Traveling to new places is the highlight not because of the new location, but more about the people and experiences (read that as the memories you make). You won’t remember everything about your trips, that’s for sure.

Afterall,

Memories is the only thing we keep.

Life isn’t only about FOREX or affiliate marketing or copy writting or whatever. Do you remember all the trades you took a year ago? I don’t that’s for sure – but do I remember renting a villa outside of Medellin last August to celebrate el Dia de las Flores with friends I met there absolutely.

It was a fun night and an amazing group of people!

Working long hours is worth it, if it enables you to make memories forever. Heck, you don’t even need to work remotely or even for yourself, you just have to enjoy what you do.

You don’t need to become a digital nomad to make these memories, you don’t need to find a way to build yourself up as a freelancer or get a job that allows you to work remotely to be able to achieve these dreams of yours.

Being able to travel constantly is amazing – you meet more people, you get to explore more places – you get to dance in strange places you’d have never dreamt off and taste so many different beers (actually that may be the highlight: Being a digital nomad enables you to try an extremely large amount of different beers – fuck living in one place, after a while you’ve tried all of them 😀 )

Craft beers on the beach with a friend watching the sunset… Is the type of memory I chase

Anyway, all of this rant was to say – the best part of being a digital nomad is it becomes easier to experience different things you’d usually never even dream off because you are outside your comfort zone.

I’m guessing none of that positive aspect is news to you anyway..


The downside:

Now this kinda sucks because most people will hate me for saying there’s any downsides to being a digital nomad… But it’s true there are (quite a few to be truthful).

Everything we love as an opposite side

To know brightness we need darkness

Lewis Mocker does a great job showing the two sides, I just can’t remember which video to link sorry – it may be this one:

Give it a watch, he’s a good guy!

Having a lot of money has downsides (more taxes, people think you’re an awful person etc)

Being a digital nomad or even a forex trader has downsides (you are responsible for yourself, something you’re not used to, most of your revenue will never be stable etc)

But to be truthful being fully responsible and not having a stable income isn’t the real downside, they can actually be seen as a positive.

The main challenge with being a digital nomad is saying good bye to people. Every time you make a really good friend it’s more than likely they will leave or you will leave and you won’t meet for the next few months or more

You won’t be seeing your “home” friends as often, it’s a lot harder to meet-up for drinks on a friday night if you’re on a different continent (strange eh)

It gets lonely.

Literally – I didn’t spend more than 3 hours with the same person while I was in Greece

You end up hating saying good bye to those amazing people so you avoid making new friends after a while.

I’ve been in that trap, only recently realized I’m giving up the best part of being a digital nomad because I’m scared of saying bye.

When you become a digital nomad – I have no doubt you would like to if you’re reading this post – don’t forget this.

Learn to appreciate saying good bye to people, try to turn it into a positive, every single good bye you say will usually lead to a new friend, you just have to say “Hi” once more.

It’s not the easiest thing to do, but if you need to talk about it, feel free to message me.


Becoming a full-time FX trader enables you to become a nomad, but what’s next?

There’s so many courses out-there trying to teach you to become a “digital nomad” would it be marketing gurus, or even forex education company but once there no one talks about it…

The incentive for everyone that helps you (or tries to sell you stuff) is to help you get there, not to thrive once you’ve reached that goal.

Becoming a digital nomad isn’t the end of the journey,
it’s only the beginning

It’s a bit like climbing a mountain – but getting to the top is being happy, confident, consistent, and thriving. Becoming able to live life on your own terms is one of the first camps, there’s still a lot of hurdles you are yet to be faced with

But there’s always new peaks to aim for

I wish there was more about getting there, for sure climbing the first peak – becoming a nomad or a full-time FX trader is great but you need to keep hiking higher. Life doesn’t finish there, instead the view you have over your life is only starting to be amazing, so keep hiking because the view from the top is always more enjoyable.

I’ll do my best to share a few things on that aspect.

The first one being, keep saying hello to new people. It may sound obvious, but at one point you will fall into the loneliness trap, it’s happened to everyone I’ve met that have been on the road for more than a year traveling to different locations on a regular basis.

Everything that comes into your life will have to be balanced, everything bad will lead to something good, someone cheating on you will lead you to meet a better person, you losing money trading may teach you a key lesson, being lonely may help you find a new best friend etc.

Start to look where’s the lesson, where’s the pleasure you’re about to receive to every time you are faced with a challenge. For every challenge you are faced it will be offset with a reward, as long as you go out there and are willing to go through the pain and struggle. It’s all about balance.

Keep looking at the positive side of things and of your situation – and remember why you do it. It’s easy to quit if you forget the why.

The first step is to love what you do.
While remembering why you do it

Embrace the challenges, be grateful for them, offset the positive and negative – you need the two sides, avoid being in a negative mindset, try to become grateful for everything. It’s freaking hard, but as soon as you neutralize all your worries you will be able to keep on going forward and even thrive

Thanks for taking the time to read this blog post! I hope you enjoyed seeing the other side of becoming a digital nomad / full time FX trader – and realized that’s not the end.


If you liked this article, it would mean the world to me if you’d share it or even just liked it on wordpress 🙂