Forex traders with this psychological profile are likely to be someone that strives to understand the world around them and who is eager to absorb new information. For the Innovative Trader, the main focus is on understanding their world and absorbing and interpreting new information.
Innovative Forex Trader Qualities
Innovative Traders can often be very good at using their intuition – masters even, which helps them to process all the new and diverse information around them. However, their judgments about the market tend to be accurate less often than they are correct and this can be a real problem for them.
After all, as we have discussed many times in our posts, intuition is not a primary tool and if used at all, it should be used only on top of a rock-solid and concrete analysis.
Innovative Forex Traders have the capacity to take in and internalize large amounts of data and news, and they are able to quickly take actions in response to the new information. This enables them to efficiently resolve challenging situations and very often score profits along the way.
Some characteristics that provide an advantage for the Innovative types of Forex traders include:
- They are able to spot trading ideas based on the broader context in the markets
- They are able to analyze the different situations in the markets and then to create trading systems
- They have the ability to accurately read people
A very important skill that the Innovative Forex Trader possesses is the capacity to be aware of the larger picture and to stay focused on the major forces that move the markets instead of being distracted by small details.
Traders of the “Innovative type” are also able to quickly and accurately determine whether a given trading strategy or system will work for them or not.
Finally, innovative traders are normally very creative and that’s not surprising given the term Dr. Tharp chose to refer to them. Finding new ways to deal with similar situations is something that comes spontaneously to them and this can be a great habit to improve and refine their trading skills and strategies.
One of the challenges and potential weakness of the Innovative Forex Trader is their tendency to be reluctant and hesitant when making decisions.
As a result of this, they often need and seek confirmation from others about their trading strategies and trading ideas.
Traders of this type can also often get bored of the repeating and tedious nature of Forex trading, hence this is a challenge that could potentially become a big problem for them, and which in the end, can affect their trading results and accounts in many damaging ways.
They must learn to be patient and to wait for the right opportunities before pulling the trigger or perhaps adopt a busier trading style such as scalping or day trading which can be much more exciting compared to the longer-term trading styles.
Innovative traders may frequently trade on emotions, especially when feeling stressed. Trading psychology is an area of trading they need to pay particular attention in order to overcome these challenges.