So, you’ve been dabbling in the markets for a while now. You’ve started up a demo account, slowly learned the ins and outs of trading. Then you’ve built your own strategy and tested it out on a live account. But the deeper you dive into the industry, the more you can find yourself overwhelmed by the amount of information available, or discouraged by the experience of losing trades, making you question your progress in the field. So how can you tell when you’re no longer a beginner?
Let’s explore the signs.
1) You understand the difference between account types and the advantages/disadvantages of each type.
This is the first sign that you’re maturing as a trader. The highest leverage available no longer becomes your absolute priority, and you start looking into more details like swaps and negative balance protection. Whether you’ve taken to scalping or trading long-term, knowing how to choose the account type that best suits your trading needs is a definite indication that you’re maturing as a trader.
2) You follow market news and economic data releases and understand the possible impact of the major ones.
The markets move in mysterious ways; except when they don’t. Most major economic data releases and geopolitical developments will influence the market in some form. You may find yourself planning your day around the NFP or holding off on a trading decision until after the ECB minutes. That’s when you know that you truly understand the importance of fundamental analysis, earning you the right to leave your beginner status behind.
3) You’re no longer searching for MetaTrader 4 tutorials.
Tutorials are an excellent way to get you started on MetaTrader 4. But at this point, you’ve learned just about enough from tutorials that you can start testing out the platform and experiencing its features on your own. There is always more to explore, but you’ve gained enough knowledge to be able to focus on your own personal development and research, and dive into the nooks and crannies of all the platform has to offer.
4) You know your way around technical analysis reports.
As a beginner, using your trading platform and making sense of the data can be challenging. But the charts are no longer a mystery to you. You now take on technical analysis reports with stride and use your favorite indicators to efficiently derive the information you need to adjust your trading strategy.
5) You have your collection of reliable information sources.
You know who to rely on for accurate market analyses and current news. You’ve done your research, cherry-picked the most reliable insight sources and even selected a few of your favorite analysts to follow on Twitter. Getting into the habit of consulting the best in the industry and choosing how to incorporate their expertise into your strategy is a sure way to know you’re becoming a wise trader.
6) You start focusing on a short list of currency pairs/instruments instead of trading everything under the sun.
One of the biggest mistakes novice traders will make is trying to capitalize on every opportunity out there. With time, you have learned to dedicate your attention to the currency pairs or instruments that you have researched and familiarized yourself with the most. The more focused your list of preferred instruments becomes, the more you know you’ve matured into a consistent, specialized trader.
7) You understand risk and know how to minimize it.
Diving into a trade head first may be exhilarating, but when it comes to achieving success, you need to take calculated risks based on a deep understanding of market conditions. Now, you make sure to assess market volatility and choose your timing correctly, and you focus on identifying the correct position size as well as minimizing your exposure. Setting Stop Loss and Take Profit orders has even become second nature to you. This is definitive proof that your rookie days are far behind you.
With all the information out there, keeping up with the Forex market and tracking your progress can be difficult. But if you do any of the above, know that you have made considerable strides in your journey as a trader and that your hard work will continue to pay off.