Forex day trading is extremely popular in the United Kingdom. Even though the success rate is very low yet the number of new participants in the Forex market rising. The majority of people start trading to change their life. They think this is the best professionals they can ever have. Just by learning few basics they invest their last savings and start trading with huge risk. Some of them might get lucky and have some big winners but eventually, everyone fails. Spread betting is an art and you need to have the potential to understand the language of the market. Try to execute trade along with the market trend and make sure you are not risking any amount beyond your risk tolerance level. In a nutshell, you have tons of things to analyze to find high-quality trades. In today’s article, we will discuss four common mistakes made in trading.
Chasing the market trend
A trending market always offers profit taking opportunities to the retail traders. Those who trade for large organizations and institutions always stick to major trends. Even though some of the traders day trade the market yet the never trade with market retracement. Rookie traders also try to use this simple principle and lose a significant portion of their investment. Knowingly or unknowingly they start chasing the market trend. You can’t make any profit by chasing the trend. You have to understand the major retracement of the market and execute a trade at the key levels. Start using the simple Fibonacci retracement tools and you can easily eliminate the problem of trend-chasing. If you miss any trades, its fine. Wait patiently for your next potential trade setup.
Trading with other signals
There are tons of online signal providers who will offer you a guaranteed profit. By seeing the lucrative advertisements novice traders get carried away. The start buying signals from untrusted sites and lose lots of money. However, some of the signal service providers tend to give good signals. But considering the long-term consequences, you should learn the manual trading system. Currency spread betting has nothing to do with an automated trading strategy. It’s your duty to do the technical analysis and find good trades. At times you might get confused with the live trade setup but this is normal. Learn to lose properly and you will be able to make real progress.
Ignoring the basic rules
There are few basic rules which every trader knows. For instance, you must trade with a reputed broker like ETX Capital to protect your funds. If you start trading the market with an unregulated broker it won’t take much time to lose your investment. You might even get scammed. Most importantly you will have a premium trading environment with no requotes. People often forget about the simple rule of money management. They start taking more than 2% risk and within a short period of time, they blow their trading account. As a currency trader, it’s your duty to limit your risk by following the basic rules.
Overtrading the market
You must not overtrade the market at any cost. Sadly, the majority of new traders don’t know the proper way to control their emotions. They are always busy with their trading chart and eventually they become addicted to this market. If you want to establish your career in the retail trading market, you must focus on quality trade execution. Forget about the outcome of each trade. The safety of your investment should always come first. Always remember, the outcome of any trade is totally unpredictable and your skill will never help you to avoid the losing trades. But if you follow your trading strategy, you can easily cover up the loss. Start trading the daily and weekly time frame and focus on your education. Take a professional course and try to understand how this market works.
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