Perhaps you have just started trading, or you’ve been researching how to get started into Forex trading. But you often find yourself asking this question, how long does it take to become a profitable Forex trader?
How long it takes to become a profitable Forex trader will depend on many outcomes. But a good Forex trader can start to turn a profit within about six to twelve months. Other scenarios that will effect your profitability are, how much time you are willing to put in. Your passion for Forex trading, the amount of commitment you are prepared to put in with your learning and Forex education.
Other requirements with how long it takes to become a profitable Forex trader are…
- you will need to have a lot of patience
- able to control your emotions in trading
- able to define a Forex strategy
- always keeping the market conditions in mind when trading
- keep your expectations realistic
- not risking more than you can afford to lose!
- learning how to read raw price action on the charts
- trading only the Daily time frame
Day trading has been a way for many people to make some additional money. Some have even been able to turn it into a full-time career. Trading can be a gamble, but the reward is often very well worth the risk.
Forex trading has been gaining in popularity in recent years. The nice thing about it is that no formal education or trading experience is required. You can open an account with a broker, have it funded in less than a day and start trading right away.
What is Forex trading?
Forex trading is trading on the foreign exchange (or Forex) market. Foreign exchange is basically exchanging one kind of currency for another. This kind of trading is usually done for tourism or commerce. Because of the large number of countries involved in this market, these assets are typically some of the most liquid and largest assets on the market.
How long does it take to become a profitable Forex trader?
A good Forex trader can start to turn a profit within about six to twelve months. Your success will vary, depending on the following factors:
How Much Time You Are Willing To Invest In Trading
The amount of money that you make from trading depends on the time and effort that you’re willing to put in. Like the saying says, you can’t put forth minimal effort and expect maximum results. Good traders usually put in at least four to eight hours a day trading or more. The more time and effort you put in, the greater chances of success you will have.
Your Passion For Trading
With how long does it take to become a profitable Forex trader, after a few months, you should know whether or not Forex trading is right for you. If you have the drive and desire, you can go far. If you don’t, you probably won’t make a lot of money trading.
Successful Forex traders don’t give up. They will have good days and they will have bad days. Eventually, you’ll have many more good days trading than bad. Stay focused and pay attention, Trade wisely.
Your Commitment To Continued Learning
Another key to Forex trading is to never stop learning. There will always be learning opportunities that come about. You can start out by learning about the market. Research securities and read about successful traders. Gain every advantage you can that can give you an advantage before you even place your first trade.
Other things to keep in mind while Forex trading are:
– You have to have a lot of patience.
Patience is key with how long does it take to become a profitable Forex trader. After you’ve been on the Forex market for a few months, you should know what to generally expect from the market. You’ll need to work on your patience skills, because you’ll need to have the patience to wait until market prices reach either the price of exit or the price of entry that you want for a particular trades.
It may sometimes take hours, weeks, or even days for this to happen. Strike when the time is right, and don’t be afraid to move on if the situation just isn’t right. You can always make more money from other transactions.
– You’ll need to keep your emotions in check.
Emotions are bound to impact any trader, especially with how long does it take to become a profitable Forex trader. They experience the thrills of making big money, but they also endure the disappointment and depression that come with significant losses. Forex trading involves a good amount of education, experience and discipline. It’s okay to celebrate when you make a decent amount of money, but don’t obsess over it.
Conversely, don’t beat yourself up or start playing the blame game when you suffer losses. Learn how the market works, and focus on your plans and long-term goals. Pay attention to your progress and focus on what you need to do.
The only real way you are going to make money in Forex trading is once you have your emotions under control. So to help with this I wrote an article all about this subject, which you can read now by clicking here.
– Define a trading strategy and stick to it.
Another important tip is to pick a trading strategy, especially with how long does it take to become a profitable Forex trader. The strategy you choose doesn’t have to be the same as your friends or family members. Pick a strategy that works the best for your needs and stick to it. There is no “one size fits all” kind of solution. You may want to adapt one strategy for certain currencies in certain markets, while another strategy works better for other currencies in other markets. Whatever you decide, be consistent.
– Always keep market conditions in mind.
Good Forex traders, always have one eye on current market conditions. Some use Fibonacci retracements and other more technical analytics to help determine their trading strategy for the day or the week.
Others have news, political and financial websites open so that they’re constantly aware of any events, trends or changes that could affect their trading performance. Take advantage of whatever utilities work best for your trading methods and goals and use them daily.
There are going to be good times to trade the markets and of course the worst times to trade Forex. If you want to learn more on when it’s best you stay out of the financial markets and when you should look to trade instead. Then head over to another trading article I wrote to explain the worst times to trade by clicking here.
– Keep your expectations realistic.
When you first enter the market, you may have very ambitious goals. However, you’ll soon learn how realistic those goals actually were. It takes time to fully understand the market, so you may have to adjust your goals quite a bit when you first start trading.
It may be tempting to attempt high risk offers, but be prepared for the positive and negative consequences that can occur. Conducting smaller transactions can gradually increase your profit over time so that you can afford to take on larger trades.
– Don’t risk more than you can afford.
When it comes to risk, it’s the most important factor with how long does it take to become a profitable Forex trader. It’s a good idea to start small. Take a look at your finances before you place your first trade, so that you can set a budget for yourself.
Never trade more than what you can afford. You could make a lot, but you could also lose a lot more. As you become more successful, you can start to increase that budget. You should then know what you can afford to lose and what your absolute limits are.
Learn how to read price action and the charts in Forex trading
Learning how to read price action and charts is another essential part of becoming a successful Forex trader. They can be rather intimidating and confusing at first to novice traders. After a few months of analysing this data, you should be able to make more informed buying and selling decisions.
Here are some of the more common price action trading techniques and how to use that information:
Support & Resistance
Support and resistance areas are commonly used by Forex traders to determine high probability breakouts or key turning points. They also display previous reaction points during recent market activity. You don’t need to figure out the ideal reaction for every currency every time. Prices are always going to change, no matter what.
Just look for consistency before you make a buy or sell trade. Watch out for resistance or support levels that are too obvious. If something seems too good to be true, it usually is. Obvious levels often indicate a crowded trade, where many people are trying to get in on the same type of trade at the same price level. This is usually an overreaction, something you’re better off avoiding altogether.
To learn more on the difference between support and resistance you can do so by heading over to one of my trading articles by clicking here.
Trend lines are more subjective, but they are still a valuable tool. When a trend line breaks, it may signal a significant increase or decrease in price. They can also be opportune trading times. Entering a particular market is often more favourable once a trend line has been retested.
You can learn more on trend lines, and how to draw trend lines like a pro with some great trend line strategies you can use today. With heading over to another trading lesson I wrote by clicking here.
High and Low Swings
Looking a the highs and lows and the swings within each period is important information for every trader. In bull markets, you should usually see both higher highs and higher lows. In a bear market, the opposite is true: there are more lower highs and lower lows. You can determine trends and evaluate market information using this data.
If you want to learn more on using swings in the market and how to read trends using the high and low swings. Then head over now to my trading lesson all about a Forex swing trading approach to the Forex markets by clicking here.
Price Action Wave Analysis
Wave analysis is commonly used in trade analytics. After enough time, you’ll be able to identify common wave patterns, such as swing waves and swing highs and lows. Evaluating this information can show you peak demand times for certain currencies. You can use this data to reasonably predict the best times to enter and exit particular markets.
The Moving Average
There are several ways to use moving averages:
– A moving average crossover can show possible forthcoming market transition periods.
– Entry filters only factor in trades that are going in the same direction as the moving average.
– General resistance and support tools provide an overview of current market trends over a given time period.
– Retesting certain moving averages during pullbacks can reveal perfect opportunities to enter or re-enter certain markets.
If you like the idea of using the moving average as a trading strategy with your own trading. Then I suggest checking out my trading lesson all about perfect Forex trading strategy with using the moving average by clicking here.
Indicators are essential for new traders. They can be a fun tool to play with. However, when it comes to how long does it take to become a profitable Forex trader, they can also induce a lot of anxiety and stress over time. Eventually, you may want to wean yourself off of using indicators for your trades. To find out why you should remove all indicators for your success check out a trading article I recently wrote by clicking here.
Learning how to read and identify market structures can help you be a more confident trader without having to rely on indicators to make every move. Not all charts and trends will always make sense, but you’ll gradually start to see more consistent patterns over time.
Trading Only The Daily Time Frame
This brings me to the final part of this question, with how long it takes to become a profitable Forex trader. One thing I came to discover in my trading journey was the use of the Daily time frame.
Trading with the Daily time frame will give you much more time to look through the charts, as well as more time to place a trade. This helps with your trading emotions and time for you to define your risks. Not to mention the larger traders such as banks or institutions are following and trading with the Daily time frame.
Trading from the daily time frame won’t be for everyone, but I can tell you that it has done wonders for my trading and helped thousands of my visitors alike. I truly believe that the daily time frame helps level the playing field.
These are just some of the most important things to keep in mind once you’ve decided to become a Forex trader. And with how long does it take to become a profitable Forex trader It can be a very enjoyable hobby or career. Take it seriously, and pay attention to every transaction. When it comes to goals, think more long term than short term.
Don’t get frustrated if you’re not seeing the results you want right away. There’s an adjustment period for everyone, no matter what their skill level may be. Enjoy the process and keep learning as you go.
Forex trading is a great way to make some extra money for those things you’ve always wanted. It can help you live a more comfortable life and set bigger and better goals after every successful year.