If you are new trading forex, there is a good possibility that you are a discretionary trader. But, what is that? Is it bad? Or good? Let’s say that it is the natural beginning of the successful trader.

A discretionary trader trusts his/her intuition, feelings, the latest news, the hottest tips, and so on. This type of trader makes buy and sell decisions on the fly, influenced only by what happens at the moment, without a strategy or a system to follow.

This trader loves the action and loves even more being part of it. He/she truly believes that his/her buy and sell decisions are smart and, if losses happen, well, just thinks that “they are part of the game”. This perspective will persist until the losses start making him/her feel uncomfortable, sometimes very uncomfortable

It is very difficult to make money consistently following the hottest tips or latest news and making trading decisions by impulse. This type of trader can make money, yes, sporadically, but not consistently. His/her losses will surpass the gains sooner than expected, and this is because the discretionary trader does not have a system, a strategy, the necessary discipline to follow it, and the emotional detachment to make successful trading decisions.

I mentioned above that discretionary trading is the natural beginning of a successful trader, and it is. This excitement of being part of the markets, playing with the pros with the possibility of making big profits, feeling an advantage over the others thanks to the knowledge of the latest world event or an “insider’s secret” is only natural to the new trader and indeed necessary to the new trader. Why necessary? Because it is the only way to truly learn that, even if all that excitement and way of making trading decisions is very alluring and full of “common sense”, it does not have a solid ground to make money. The trader must realize it on his/her own; otherwise he/she will continue being seduced by it until it finally hits him/her.

But, can a discretionary trader become a truly successful trader? Oh yes! Once this stage is over, the real profits start coming in. How long does it take to pass this stage? It depends on the amount of losses and how the trader feels about them.

There is no way for a trader to become successful overnight. It is a process that he/she must follow in order to learn how to trade the markets. A smart trader knows that this process is worth it because the rewards are big. Very big.

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