He begins, “Although we have had a wild past few weeks in the markets, this is not a time to panic and sell just to watch the markets reverse and have some massive rallies back to the upside. This is what the markets do: they go up and they go down-but they don’t do it in a straight line. As the markets were selling off last week I had clients asking me what should they do, sell or ride the storm out? I asked them all the same thing, “What type of investor are you?” The common response was, “What do you mean?”
This is a very good question actually posed by Jason. Often I get traders asking me questions about what to do when they see huge fluctuations in the forex market. People don’t wanna lose out on potential massive pips, yet at the same time it’s extremely risky to jump on the short or long bandwagon if you don’t even know what type of trader you are. Knowing what type of trader you are means you know your rules. It means that, whatever the market may throw at you, it won’t make you panic in the hope that, “yes, I MUST get in now, awesome pips to be made here!”.
Jason expands,”See, here is the first rule in investing: you need to know what type of investor you are. Are you a Day trader, Swing trader, mid-term trader or a long-term trader? The reason I ask is because if you are a long-term trader, then why do you care what the market is doing today… if you are a Swing trader, then you need to know where your stop loss prices are and have them in. I strongly recommend you really sit down and think about what type of trader you are and create a plan accordingly. This is designed to help you become a much better trader overall.”
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He’s hit the nail on the head right there. Know who you are. Know your personality. Know what you enjoy and what you don’t. If you don’t enjoy it at all, whatever method, timeframe or style you’re trading, especially after a number of years, then maybe trading itself isn’t for you. But if you’re determined to succeed in trading, then it’s imperative you establish what kind of trader you are, or you wanna be, and take it from there. There are some who just can’t stand staring at charts all day long, whilst there are others who can’t get away from the 1min charts. Only you can decide for yourself which path you want to pursue.
Finally, Jason goes into a secret you guys ought to know about…
He says, “I will let you in on a little secret that only the pros know and most everyday investors and traders don’t realize. There are two words that you should never forget…”