BLOG Forex Psychology Forex- How Many Trades per Day?
Many traders claim that in order to be successful in forex, you have to stay away from overtrading. What is considered overtrading? How to stop yourself from trading too much? What kinds of emotions lead to overtrading mistake? How much money can you loose from trading too much?
Overtrading is definitely a curse of forex trading. In many cases, overtrading comes from feeling overly confident and lucky. To make things worse, usually you trade too much, when you stop following your plan and your system, allowing impatience to conquer the discipline and feeling an urge to stay in the market despite the lack of proven signals to do so. Many traders actually convince themselves that there is a signal, when there is absolutely nothing going on.
Making many trades daily can turn against you in a blink of an eye, therefore many traders choose not to trade too often in order to stay on a safe side. Of course, you may argue that it is not about quantity, but about quality. Why would the amount of trades matter, when the actual success depends on what kind of trading decisions you make. You can make one trade per week and, if it is lousy, you still lose the money.
So how many trades should you make? It is possible not to trade daily and still make just as much money as you would have made with several trades per day. What is the secret? The secret is, of course, the research. The more you learn about economics, technical analysis and fundamental changes, the higher chance you enter a profitable trade.
It is not about quality and not about quantity. It is all about you being prepared and making the right kind of decisions. Trading too much simply doesn’t allow you to learn and analyze and research enough to make the right moves.
All that being said, forex trading is not a science project. Many times you have to be flexible and figure out what is the right way to follow. Sometimes, trading every pullback or following the main trend is the right choice. Other times, being patient is the way, taking one trade per trend and stick with it till the end. Every single day forex market presents new opportunities and trading situations. The success doesn’t only depend on your decisions and planning, but also the changes and twists of the market itself.
So, the amount of trades per day is not as black as white as it may seem at first. You have to trade according to your views and understanding of the market conditions. Sometimes, your intuition will result it 3 trades per day. In other cases, you might end up not trading at all for the whole day. You cannot control the market, but you can fit your trades to it and make profits.
In my experience, about 5 trades per day sound right, however, once again, you should be comfortable, assured and relaxed about your decisions. The best advice is not to judge your trading frequency by that of others. The frequency has to follow your rhythm only and shouldn’t be influenced by other point of views. Your rhythm and trading style comes from your entry and exit measurements, risks management, targets and goals, financial situation and much more. Submerge yourself into the market instead of trying to fit the market into your limits.
