Why You Should Not Quit
Your Job to TRADE FOREX!
Never quit your job to trade forex until you have shown consistency within a demo account for at least a couple of months, trading every day. If you opt to trade a live account right away, then trade a very small position size and keep risk to a very tiny fraction of your account (less than 0.1%…yes, less than 1/10 of 1%). As you get better you can also increase position size…but not before you get better.
Practice is not just putting in hours. Take notes, record what works and what doesn’t. Everyone else is just putting in hours too, but 95% of them fail. Be different; go the extra mile in your practice to really dig into improving your methods. Be methodical. Look at each segment of your trade and write down how it could be improved and what is good about it. Do this constantly; it is your practice time, so make it worthwhile
Have money saved up to last you a year (in addition to trading funds) so you can commit all your energy to the day trading pursuit, or have several months worth of savings (in addition to trading funds) and/or a part-time job which covers your bills each month. If you’re worried about money when you start trading, it’s likely going to be much harder for you. Instead, save up a bit more money…be patience in getting started, the markets will be there…there is no rush.
The next step after you’ve proven your method in a demo account is to open a live account, trading the smallest position size possible, and increase the position size only if consistently profitable. If you are going to quit your job to day trade, have your financial affairs in order, and assume it will take at least 6 months or more before you start to see consistent profits. Preferably don’t give up your income until trading is at least partially replacing what you are giving up. Get a part-time job to help relieve the financial strain you will inevitably feel during your learning curve. Many traders struggle when transitioning from demo trading to live trading, so even if your demo trading was profitable, it could be many months before you see those types of returns in a live trading account. There is more psychological pressure with real capital, so there is another learning curve when you transition to real capital.
Seek out someone to give you feedback on what you are doing. Preferably someone who has been through what you are going through, and has come out the other side a profitable trader. If that isn’t possible, seek out other traders either online or in your town via meet-up groups or a local technical analysis chapter. You may find talking with others helps speed up your progress. If you feel it slows you down though, stay away.
Practice, practice, practice. Day trading is not necessarily about acquiring knowledge. Like a sport, you need to act. Theory is great, but it doesn’t make money in the markets. To make money you need to go through many repetitions doing the same thing. Get into a demo account and practice trading specific trade setups–which have a statistical edge (profitable)–over and over again. This way, when you switch to live trading you won’t need to question what to do. You will act with precision based on what you’ve practiced. Trading with real capital will take a bit of an adjustment period, but at least you know what you should be doing. Work on doing it. Trade the smallest size and only build to risking 1% or 2% of your account balance as your consistency improves.
The nice thing about forex is that the market is open 24-hours during the week, so it is an accessible market for people who don’t want to quit their job to trade (just yet), but want to start building some extra income in their spare time.
Quit your job to TRADE FOREX? That’s up to you, but hopefully now you can make a more educated decision.