How to Pass Prop Trading Challenge: Advice by Rana Das, CEO of Forex Wave Expert
I did not fail any of the five prop trading challenges that I undertook in 2023. However, don’t think that I am an expert in trading. I would rate myself as just a mediocre (5 out of 10) trader. So what made the difference? In this case, my discipline was a solid 9/10. These few principles worked wonders for me. If I could do it, then you can do it too. This is quite a ride for me in the year that has just passed in prop trading. As far as the year 2023 and 2024 are concerned I was confronted with some very stiff competition. As much as I did not fail a single prop trading challenge in the year 2023, things went wrong recently. I excluded myself from a multi-account not because I lack the skills or the abilities, but because some health and psychological problems emerged midway through the process.
However, I should mention that I grossed a good +62% profit from FTMO throughout this period. But at what cost – my mental and physical health took a significant beating. And as I have come to understand over the period I have been trading, it is about 80% mental and only about 20% trading. This realization came as a shock, staying up late at night dealing more with my attitude than the market.
Right now I am a migrants patient and I rely on my treatments and my progress. What I know is that by summer which is few months from now, I will come back fired up with more learning that is not limited to trading only. If you also face such issues, I want to suggest you follow the tips that I will provide in this article. For he or she can assist you remove some of the psychological scars, which are critical in helping you start, progress or even pull out in trading.
Now let’s cut through the crap and get straight to the point. Here are some tips from me, Rana Das, CEO of Forex Wave Expert, if you want to pass every prop trading challenge:
1. Focus Not on Winning but on Avoiding Loss
The key message here is not to strive to win, but to lose – or more appropriately, avoid losing in any form.
At this point, one may wonder what my specific goal was not necessarily to ‘overcome’ the prop trading challenge itself. My main role was to safeguard any dollar that I was putting into the business.
The $600 that was tied to my first hundred-thousand-dollar prop trading challenge felt like such a big deal –it was nearly one month’s cost! That means, there was no way I could throw that away on a reckless trade; by concentrating on safeguarding your investment, you will remain disciplined and cautious, thereby allowing you to stay long in the game.
2. Quality Over Quantity
It is as simple as that – it is the longer time horizons that are the most lucrative. However, trading on 1-minute chart seems to be very attractive, but it is a big no for freshmen.
It eliminates the pressure that was earlier provided in the form of an attempt within 30 days to do a particular task speedily. I continued sticking to four hours and daily charts, which aren’t very glamorous, but they offer good quality entries. Trading does not imply in front of your screen all day, waiting for a shot, more of a sniper kind of situation.
3. Avoid Risky Trading During High-Impact News Events
Trading during news is like tossing a coin; it is safer not to trade in such events it is too risky.
Even an event as trivial as the fed rate decision, Non-Farm Payroll (NFP) report or any other event that causes a stir in the market is better off left alone. They can even go out of control and unpredictable during these periods – and why take the chance? The best idea is to skip trading in accordance with the news and focus on other trends in the market.
4. Keep Emotions in Check
Good trading cannot be done if emotions are involved. You may feel bad when you lose a trade, but trying to recover your losses hurriedly may lead to destruction.
Trades are always emotional, but it is even harder when you are required to meet a challenge; however, when you are pushed to pass a test, this gets even tougher. Take your loss, take responsibility, and walk away. Going right back into the market after losing on a trade is the fastest way to go broke.
5. Use Dynamic Risk Management
This plan worked great magic for me.
When I was actively trading I used to carry one percent of my account to a trade when I was undertaking any task. But as soon as I faced any drawdown, I moved the risk right down to zero. 5% and even lower. This strategy is amongst measures that are useful to avoid falling greatly on the account. This way, it is easy to get out of the hold of the rough patches of the financial cycle, and not increase the miseries by getting deeper into debts. Basically, it is just like managing to slow down when one is experiencing a bumpy road, so as to continue living and regain his or her strength on the road.
6. Have a Written Trading Plan
This one’s crucial: Write down your trading plan.
- What time of day will you trade?
- Which currency pairs or assets will you focus on?
- What’s your risk management strategy?
If you have a clear, written plan, then all that noise is blocked out, and it makes focusing easier for traders who know what they can control, staying calm and ignoring everything else.
Key Takeaways from Rana Das, CEO of Forex Wave Expert
Remember, it is not about being the best trader globally that you can pass prop trading challenges. But have a good plan, stick to it, and let your emotions be in control. Adhering to these principles will increase your probability of success.
Besides, do not ignore Forex Factory news and utilize resources such as MetaTrader 4 or 5 for tracking Forex rates on the market. These tools are essential in today’s fast-moving forex trading world if you want to be successful.
If I could overcome these obstacles, so can you. Go back to basics, be disciplined, and make sensible trades.
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