Steps of a trading journey

When we started out with trading we were looking up to some of the most successful traders in the forex industry and their lifestyles. There was and always has been a burning desire to reach (financial) freedom from trading including global travels, luxury goods and the ability to extract unlimited sums of income from the markets. This view has always been the biggest driver for us and will probably be for most of you as well. However, what is often overlooked is what it takes to reach this level of success. Although this vision is now unfolding itself into our own lives, the journey was not what we expected it to be. You have probably seen illustrations about the road to success such as the one below, but have you ever thought about how you would actually walk this route? In this article I want to explain to you what steps you can take towards becoming a successful trader so you can draw up a plan for yourself to actually reach that goal.




I can tell you up front that there is no secret formula to becoming a successful trader. But with proper planning, a focused approach and a burning desire to succeed you can get a long way.

I decided to create a list of phases which we encountered in our journey and which I believe can serve as a great outline for your own planning.

  1. Orientation

  2. Learning from others

  3. Backtesting & Live testing

  4. Your first live account

  5. Trading alongside your job/study

  6. Developing your own strategy

  7. Becoming a full time trader


Orientation

I assume that if you’re reading this article you have already established an interest in trading the forex market. The forex market is the biggest market in the world and with that there are an endless number of methods you can use to approach this market. In this first phase it’s your goal to find an approach to the market that fits you best. The most common approaches to the forex market are the following:


-Swing trading. Longer term approach holding positions for days up to weeks. -Day trading. Short term approach where positions are hold for hours up to a few days. -Scalping. Extremely short term approach where positions are opened and closed within hours or even minutes.


It’s important that you figure out which of these time based approaches suit your interests and lifestyle the most. Do some research on each method and associated strategies and make a ranking on what works best for you at this point in time. As a suggestion, starting out with a swing trading approach works best for most people their lifestyle and psychology in the beginning of their trading career.


Learning from others

Once you have picked your approach you can start to look for specific strategies that fit within the approach. At this stage of your journey I do not recommend developing your own strategy. You definitely want to go there in the future but in this early stage it is most important to gain specific knowledge. The best way to gain specific knowledge is to find a mentor who: -Is an experienced trader -Has developed an own strategy -Allows students to trade alongside him/her


The most difficult part of this stage is to find a mentor/education provider who serves your personal needs in addition to the basic requirements listed above. This will require an investment from your side to gain this knowledge but it will significantly fast track your progress and you will have the chance to make money back by trading alongside your mentor.


Back-testing & Live testing

While in your learning phase it is important to put your knowledge into practice as soon as you understand what you’re being taught from a theoretical standpoint. A mistake most people make is to go straight into live trading their own money as soon as they start to g