“99% Of The Time, Profitable Traders Do Nothing!” – The primary reason why most Forex traders lose money in the market is due to their tendency to overdo things. They think and analyze too much, keep an eye on charts excessively, trade too often, take high risks, and so on.Conversely, the most prosperous Forex traders and investors today devote 99% of their time to patiently waiting for opportunities and studying market trends, rather than frequently trading.
In essence, they spend most of their time doing nothing..
Have you adopted a similar approach to trading or are you spending 99% of your time entering and managing trades, with only 1% of your time devoted to waiting patiently?
Trade Like a Predator
A successful forex trader spends a great deal of time waiting for the perfect opportunities to present themselves, much like a crocodile patiently stalking its prey. The aim is to trade like a predator, waiting in the “bushes” for the ideal trade setups to emerge, rather than rushing in like a prey and being “eaten” by the more experienced Forex traders.
To achieve this, the key is to exercise self-control and patience, adopting a “hurry up and wait” approach. Waiting for the right market conditions to form with the perfect market confluence is vital. In fact, a Forex trader who waits for weeks or even months to find the right setup is not unusual.
This is because the reality is that high-frequency trading usually leads to losses in the forex market, while low-frequency trading is more likely to result in profits. Experienced Forex traders understand this fact and know that patience and discipline are the keys to success in forex trading.
Warren Buffet Is The Master At Doing Nothing…
Warren Buffet, the greatest investor of our time…
Interestingly enough, Buffet also applies a similar patient and precise approach in managing his billions of dollars in the market. He doesn’t enter the market every day; instead, he waits for the right opportunities to present themselves before making a move. His investing style is often referred to as low-frequency and high-conviction, where he dives in with full commitment when he’s ready, sometimes even acquiring entire companies.
As Forex traders, we can learn valuable lessons from Buffet’s approach. While our trading strategy may differ from his long-term investment philosophy, we can still model our swing trading approach after his patient and precise style.
Change Your Perception Of “Doing Nothing”
As human beings, we are wired to seek instant gratification in all aspects of our lives. Our addiction to checking social media on our phones is a prime example of how we crave the feel-good chemical, dopamine…
We tend to prioritize what feels good over what is actually good for us. This gamblers or speculators brain that we are born with, seeking instant rewards and thrills, can have severe consequences when it comes to trading.
This behavior often leads Forex traders to treat their trading accounts like a slot machine, entering trade after trade as if they were pulling the arm of a slot machine in a casino. While we expect to lose at a casino, trading involves risking more than we should, trading with money that we can’t afford to lose, and believing in some innate ability that will make us profitable. The dopamine fix Forex traders get from entering trades can quickly turn into an addiction that leads to blowing out their trading accounts.
How can Forex traders overcome their harmful trading mindset?
According to Jim Rogers, one of the most important principles to learn in investing is to refrain from doing anything unless there is something to do. ManyForex traders, on the other hand, are always looking for a thrill and feel the need to be constantly active. They may make a big trade and think they are clever for tripling their money, but then rush to invest in something else. This mindset can be toxic, leading to impulsive trades and reckless risk-taking.
To counteract this harmful trading mentality, it is essential to accept and embrace the idea of doing nothing. This may seem dull or unproductive, but waiting patiently for the right opportunity to present itself is the key to successful trading. By meditating on the concept of doing nothing, Forex traders can shift their focus away from instant gratification and towards long-term gains.
As Forex traders experience significant profits from waiting for high-quality trades, their mindset will begin to shift. Instead of craving the rush of entering trades and constantly tweaking their positions, they will find satisfaction in the periods of waiting and studying the market. While it may be difficult at first to overcome the urge to always be active, mastering the ability to do nothing is crucial for long-term success in trading.
The market moves at a slower pace than most Forex traders imagine, and successful trading requires patience, discipline, and the ability to wait for the right opportunities to present themselves. As highlighted in this article, profitable Forex traders spend most of their time stalking good trades and waiting patiently for the right market conditions to align. They understand that trading with high frequency is a surefire way to lose money in the market, and that trading with low frequency is the key to becoming a profitable Forex trader.
By adopting a low-frequency, high-conviction approach and emulating the practices of successful investors such as Warren Buffet, Forex traders can avoid the poisonous trading mentality that often leads to impulsive decision-making and large losses. By changing their mindset to embrace the idea of doing nothing and mastering the art of waiting patiently, Forex traders can become predators in the market and increase their chances of success.