Forex trading has become a trendy full-time/part-time job and hobby, that's why, due to its popularity, you must be aware that there are a lot of scammers out there who would take your bucks and sell you snake oil.
A good mentor is like a good franchisor, they've been there and have streamlined a capable system that reduces loss and maximises profitability.
The hardest part of becoming a successful Forex trader is getting the right education. Remember, the right start is vital, and a bad one can have a massive psychological impact and affect the rest of your trading career.
It's important to find the right learning resources; fundamental data feeds, charting software, and, most of all, the best mentor who will guide you on your path to success.
There are six obvious facts that gurus will need in order to be recognised as "true traders".
#1: Keep Your Methodology and Charts Consistent
You must know what information you will need from a Forex guru to make an appropriate decision about whether to follow or not. Some trading mentors pay attention only to the underlying fundamentals of the company or economy. They might use a technical chart to determine the best time to execute a potential trade. Others will use pure technical analysis, and some see the whole picture to pull the trigger at the best possible entry points based on both fundamental and technical alignment. When choosing a guru and methodology, remember that it needs to be clear, concise, and consistent.
#2: Check Pre-Fact Analyses
In my opinion, this is the core trait of any real Forex educator or analyst. Simply put, most traders don't care what happened after it happened, e.g., "post-fact".
What matters to them is the edge. The primary strength of real-time, pre-fact technical analysis is its efficiency, practicality, and utility. What you learn by reading proper and accurate analysis can be used to improve the methodology of your choice as well as entries and exits for any of the currency pairs. Very often, it can be used across other markets, and, more importantly, across different time frames.
#3: Don't Follow the Herd
If you always follow the herd, your result may be not good enough. By the way, having a herd mentality is not successful, but quite the contrary.
If you hear a tip that there will be a movement one way, where everyone is expecting it and moving to take advantage, and you always follow it blindly, you will probably never be more than an average Joe trader.
If a Forex guru is willing to move against the herd, you might want to listen to them because obviously, they've had experience trading and analysing the market.
Don't forget that The key is finding situations where most of the technical signals point in the same direction. I call it POC (Points of Confluence). These high-probability zones are usually profitable.
#4: Be Flexible
It's the confidence to foresee what others in the market cannot that is the primary strength of a good Forex educator, but they also needs to adapt to market changes. The markets are constantly changing and a Forex guru should teach you to adapt accordingly.
The markets are not the same as they were five years ago, let alone ten, which is why most systems do not work anymore – they are simply not adapted to the current markets.
Good Forex trading experts follow a certain methodology and adapt it to the present market conditions. They never deviate from a good methodology unless something causes them to do so, such as market volatility/sentiment change.
#5: Commit to Doing Whatever it Takes to Help Other Traders
Analysing the markets the proper way is not easy, let alone if you opt to trade it. Hours and hours of screening time are needed to efficiently interpret the market. Most successful Forex mentors started with little or nothing regarding trading capital, but they built their success in the face of people telling them that it couldn't be done.
The emotional drive of fear and greed will be the life and death of most traders. The highly successful Forex mentors understand that the market is always right no matter what they may think. They have respect for the market.
#6: Share Facts
Analysis and trading are not the same. As a matter of fact, it is a completely different field. Analysts don't need to think about money management, risk factors, need/greed, emotions, etc.
Traders do have to think about all of the above. Switching your position from an analyst to a trader is not what you will see occasionally. I myself prefer to be both. Showing pre-fact and post-fact results, in my opinion, is a must for every successful Forex guru.
When it comes to trading, account statement is sufficient. When it comes to analysis, pre-fact and post-fact snapshots are a very good way to see how it performed.
One of the reasons I have been showing pre-fact and post-fact results on the analysis page and in webinars is to keep accurate and detailed records. Once the trade has been executed, you will be able to go back and analyse how it performed.
The Bottom Line
Trading success will depend on your ability to observe the markets, use your own initiative, ideas, and knowledge to effectively trade it. Your Forex guru should help you achieve your goals. Even if you follow analytics only, the knowledge you gain will be a clear step towards consistency and success.
What has your experience been with Forex mentors? Let us know in the comments below!
Cheers and safe trading,