2021: Life Lessons from Forex Trading
By: Gift Ibe
Tags: 2021, Lessons Learned, Forex, Stories, Life

Forex trading has been a crucial part of my life for about three years, and it has come with its ups and downs as any journey in life. Firstly, it is a well-known figure that 90% of Forex retail traders do not succeed on this path. Some publications quote failure rates as high as 95% typical reasons such as experience, discipline, and strategy, psychology has been accrued to these results, and while these may be factors leading to such percentage, I’ll not dwell on the reasons for the values but provide the impact of the journey backed-up with some quotes I find inspiring :)

Decide on a fixed risk to accrue if the trade goes south.

A quote by Sylvester Stallone says, “ when life hits you pretty hard, you can go into a dark corner.” Trust me when I say this is a reality for a trader; you can have the right experience, resume, looks, strategy, intention, process and still end up with significant losses, rejection, pushed away in life. All these could happen for your plans only to move in your direction in the next ones you’ve signed out or been evicted. It makes you wonder if some forces are all up against you.

A lost trade on the NZD/USD pair, only for things to progress as planned

But the truth is, it’s you against you all day, your yesterday against your tomorrow, what you know against what you should or yet to learn. There’s no manual titled “how to get along with life successfully.” We have to grow and walk into scenarios and experiences planned and unforeseen. The most we can do to possess some level of control is having stop-losses, a safeguard, some limit to the extent to which we can say “that’s enough.” However, this can’t always be possible in life. Still, I’ll say that for one to make progress or achieve success in relationships, business, contracts, boundaries/limits has to be in place.

Aim to have a bigger big picture on Higher Time-frames (HTF)

In pursuit of various goals in my life, I’ve seen the difference in behavior, drive, and decisions when having a bigger picture and when not. I joined a youth-based organization (AIESEC) to foster change through youth leader and development early this year. We had this project (SDG Week) where we had to carry out one of the Sustainable development goals (SDG) by the United Nations (UN). Groupings were done with positions were shared. I being in charge of the finance aspect. I came to understand that irrespective of the size or value of a job or role, it was essential to understand your place in the overall big picture, which provides a sense of belonging, achievement, and direction.

The gray spot as seen from a lower time frame shows a down-trend.

AUD/USD pair showing an uptrend on a HTF, but note the gray spot

Speaking or hearing Forex traders talk about their various strategies, one key point mentioned is they always start from a higher time-frame (HTF), be it (monthly, weekly, daily, 4hourly) depending on their strategies. Traders say that “ the trend is your friend.” Still, I must add that “the trend on the higher time-frame or screen is your best friend.” one must be apprised of the significant, overall movement of situations occurring in their life to steer a minor decision or path correctly.

Confluence and Confirmation

Confirmation and confluence are vital factors considered before entering a trade, and they are interchangeably used to mean the same thing. Confluence in trading is the combination of more than one trading technique or analysis to increase your odds of a winning trade, and these techniques or analyses are your confirmations. They’re your boxes you have to tick before entering a trade, deal, or contract. Confluence and confirmation help keep you in line when and if you divert in your strategy. These could be things like:

Two hours at the gym four times a week

Break of structure in chart analysis

Dinner date every Friday

Eat an apple a day.