Forex Mistakes – The 3 Biggest Errors Novice Traders Make Which Cause Losses
Here we will look at the 3 major mistakes which most novice Forex traders make and if you make them, you will end up in the majority of losers too. There easy to avoid, so let’s look at them and give you some tips on achieving Forex trading success.
In Forex trading 95% of traders lose all their money but a huge number of traders think they can make money with no effort and the first is a very common mistake
Using Forex Robots and Expert Advisors
If you see a cheap Forex software package with hyped copy and a track record that looks to good to be true – it is. You supposed to believe that for the cost of a night out, you can make more money than the world’s top fund managers, with no effort on your part needed. If Forex trading were that easy, everyone would be trading and no one would bother to work. These systems give Forex a bad name avoid them or you will lose all your money quickly.
Not being Prepared for the Emotional Impact of Losses
When you trade only you can be wrong and the market price is always right but when traders start to lose, rather than accepting this fact and keeping their losses small, they get angry and annoyed and either, run their losses, try and get revenge on the market and trade to much or simply swap systems. This leads to disaster, if you want to win you have to be disciplined and keep your losses small, there is nothing wrong with taking losses, because you will get profits which you can run to cover your losses. The object in Forex is to make money and that means accepting and taking losses and not trying to be right all the time which is impossible.
You can go online and get 300 – 500:1 leverage but this is far to high for most traders – 10:1 is about right for most traders. If you leverage up to far, not only do you risk getting wiped out by price spikes, you have a commission impact on your account and on small accounts this can mean you have to cover 10% in transcation costs alone just to break even!
Most brokers make money when you lose, as they have the opposite side of the trade and they know an over leveraged account will blow up, so them giving you more leverage is not generosity, it makes good business sense to them.
If You want to win at Forex
Accept you have to educate yourself and get a simple Forex trading system which is robust and easy to understand, you will then have the confidence to trade it with discipline to achieve Forex trading success.
Anyone one can learn to win at Forex, so avoid the common mistakes enclosed, get yourself a good education and in a few weeks, you could be making a great second income, in the world’s most exciting and lucrative investment field – global Forex