If you're into all things investments & making money (which I'm sure you are since you're reading this right now, I'm sure you've come across articles about the do's and dont's of trading & absolutely how can making mistakes and losing money...
So why am I even bringing this up?
Why is this even relevant at all?
Good question...
You see, the mistakes forex traders make are legion.
In a market as dynamic as the forex market, it is very easy to make a mistake and get blown off as a result.
1) Overtrading:
This is probably one of the commonest mistakes that traders make. Every trader will sustain a loss at one point or another in a trading career.
However, too many traders try to cover the loss by placing more trades after a losing trade, or trying to open counter positions on the losing trade.
This will inevitably lead to more losses; when fear pervades and the trader has been unsettled, it is more difficult to make rational trading decisions and easier to make mistakes.
2) Misinterpreting the News:
If you are a newbie trader and do not know how to interpret a news item, for example a press statement by the ECB Chairman on the ECB monetary policy, it is best to avoid trading it.
Indeed, you have no chance of winning if you are unfamiliar with the connotations of certain words used. Moreover, there are initial market whipsaws as traders try to make sense of the statements, and once a pattern has been established, the EURUSD will follow that pattern.
Any trader trying to get in at the beginning of the ECB statement (which notoriously comes just after a medium-impact US news release), is more likely going to get stopped out.
3) Poor Money Management:
It is always advisable that a trader should never commit more than 5% of his trading capital into trades. Put another way, a trader’s exposure to the market on all positions should not be more than 5%.
This is the only way to ensure that a loss (especially when you are a beginner) does not do irreparable harm to your account.
In forex, you need to live to fight another day.
Profits are best taken a little at a time. I have seen traders exposing as high as 50% of their account size in the hope of one big payday. This practice will invariably lead to a margin call in a short while.
4) Lack of Practice:
Many traders do not practice enough on demo, and are not willing to invest in acquiring forex trading knowledge. They prefer to pay signals providers to provide trading signals for them.
It always pays to learn to trade. Many signals services are nothing but scams, and it is not uncommon for a trader who uses his commonsense to see a trade setup which negates a signal provider’s call.
5) Inadequate Training: Forex is a lifetime business that requires a significant amount of knowledge to succeed. Many traders go for weekend training courses and quickly wire money to their brokers to commence trading.
More often than not, such monies are lost pretty quickly in the forex market. Forex trading is like any other job.
Getting a good job requires basic education, high school education and at times college education in order to land one. What makes forex trading any different?
6) Lack of Due Diligence on Brokers:
Many traders do not do some due diligence searches on forex brokers. A good broker is one who is regulated, does not manipulate prices through dealing desks, does not create slippages during news releases, and attends to customer requests in a timely manner.
A good broker must also honour withdrawal requests in a timely fashion. Traders have lost money to scam brokers by not doing their due diligence.
A little sniffing around in online forums and review sites will provide a ton of information on broker performance.
There are other mistakes traders make, but these are the commonest ones.
Fortunately, trading forex CAN be easy, simple & on AUTO-PILOT.
The EFS system lets you trade without emotion and makes the trend YOUR FRIEND, while trading in a time zone compatible with YOUR life and YOUR commitments.
You don't have to sit in front of a computer all day long or for hours at a time monitoring the market. And since the market is open 24 hours, you can keep your 9 - 5 and trade around your job and family commitments... and quickly build up your 2nd income to eventually REPLACE your job income and more...
Believe me it couldn't get any easier!
All you need right now is the right INFORMATION.
... And the even better news is that you can get everything here RIGHT NOW:
This proven approach has worked for THOUSANDS of others who have lost hope & struggled with their trading too. The first step on your journey to that pot of gold begins with you and ONLY you.
So what are you waiting for... go make it happen already! :)
So why am I even bringing this up?
Why is this even relevant at all?
Good question...
You see, the mistakes forex traders make are legion.
In a market as dynamic as the forex market, it is very easy to make a mistake and get blown off as a result.
1) Overtrading:
This is probably one of the commonest mistakes that traders make. Every trader will sustain a loss at one point or another in a trading career.
However, too many traders try to cover the loss by placing more trades after a losing trade, or trying to open counter positions on the losing trade.
This will inevitably lead to more losses; when fear pervades and the trader has been unsettled, it is more difficult to make rational trading decisions and easier to make mistakes.
2) Misinterpreting the News:
If you are a newbie trader and do not know how to interpret a news item, for example a press statement by the ECB Chairman on the ECB monetary policy, it is best to avoid trading it.
Indeed, you have no chance of winning if you are unfamiliar with the connotations of certain words used. Moreover, there are initial market whipsaws as traders try to make sense of the statements, and once a pattern has been established, the EURUSD will follow that pattern.
Any trader trying to get in at the beginning of the ECB statement (which notoriously comes just after a medium-impact US news release), is more likely going to get stopped out.
3) Poor Money Management:
It is always advisable that a trader should never commit more than 5% of his trading capital into trades. Put another way, a trader’s exposure to the market on all positions should not be more than 5%.
This is the only way to ensure that a loss (especially when you are a beginner) does not do irreparable harm to your account.
In forex, you need to live to fight another day.
Profits are best taken a little at a time. I have seen traders exposing as high as 50% of their account size in the hope of one big payday. This practice will invariably lead to a margin call in a short while.
4) Lack of Practice:
Many traders do not practice enough on demo, and are not willing to invest in acquiring forex trading knowledge. They prefer to pay signals providers to provide trading signals for them.
It always pays to learn to trade. Many signals services are nothing but scams, and it is not uncommon for a trader who uses his commonsense to see a trade setup which negates a signal provider’s call.
5) Inadequate Training: Forex is a lifetime business that requires a significant amount of knowledge to succeed. Many traders go for weekend training courses and quickly wire money to their brokers to commence trading.
More often than not, such monies are lost pretty quickly in the forex market. Forex trading is like any other job.
Getting a good job requires basic education, high school education and at times college education in order to land one. What makes forex trading any different?
6) Lack of Due Diligence on Brokers:
Many traders do not do some due diligence searches on forex brokers. A good broker is one who is regulated, does not manipulate prices through dealing desks, does not create slippages during news releases, and attends to customer requests in a timely manner.
A good broker must also honour withdrawal requests in a timely fashion. Traders have lost money to scam brokers by not doing their due diligence.
A little sniffing around in online forums and review sites will provide a ton of information on broker performance.
There are other mistakes traders make, but these are the commonest ones.
Fortunately, trading forex CAN be easy, simple & on AUTO-PILOT.
The EFS system lets you trade without emotion and makes the trend YOUR FRIEND, while trading in a time zone compatible with YOUR life and YOUR commitments.
You don't have to sit in front of a computer all day long or for hours at a time monitoring the market. And since the market is open 24 hours, you can keep your 9 - 5 and trade around your job and family commitments... and quickly build up your 2nd income to eventually REPLACE your job income and more...
Believe me it couldn't get any easier!
All you need right now is the right INFORMATION.
... And the even better news is that you can get everything here RIGHT NOW:
This proven approach has worked for THOUSANDS of others who have lost hope & struggled with their trading too. The first step on your journey to that pot of gold begins with you and ONLY you.
So what are you waiting for... go make it happen already! :)
