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Ten mistakes all successful FX traders should avoid – ForexLive

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Ten mistakes to avoid when trading FX

If you aim to become a successful and profitable forex trader, there
are a number of seriously damaging mistakes that you’ll want to avoid. It
should go without saying that you will make some mistakes when learning how to
trade.

It’s simply unavoidable. This is
not necessarily a bad thing, as mistakes allow you to learn and grow. The ten
mistakes that you’ll read about below are among the most common and as such,
tend to be the most damaging when not noted and corrected.

1.
Entering into too many trades at once

If you’re entering into multiple
trades at once, you’re likely over-trading. Each trade deserves your full
attention to help ensure that it is profitable. Dividing your attention among
multiple trades will only decrease the odds of each of those trades resulting
in profit. Less is more when trading FX and the sooner you realize this, the
better off you’ll be.

2.
Devoting too much time to analysis and trade planning

While trade analysis is necessary,
it can take up too much of your time. You may even find that you’re spending
way too much time in the planning phase and very little actually trading. There
will only be a number of optimal entry points each day. Don’t miss out on too
many of these by being locked into exorbitant trade planning.

3.
Placing too much focus on short-term charts

Trading too frequently on the
short-term charts can lead to over-trading and over-trading can lead to fast
losses and a gambling-like approach to forex trading. Additional, critical data
comes from higher time-frame charts such as those seen within the EagleFX
platform, and these charts tend to be more important than lower time-frame
charts. With higher time frames, you’ll receive more reliable signals and a
reduction in your stress levels.

4.
Bypassing the opportunity to trade on a demo account

One should never trade with real
money before trading with mock funds using a demo account. Even if you’ve done
your homework and are certain that you know how to trade, you need to see
trades in action within a platform. EagleFX offers free, unlimited demo
accounts to all. Visit them now to create a practice account and avoid this
terrible mistake.

5.
Trading solely based upon the news

Don’t assume that you know which
way the market will move based solely on the news. Far too many traders have
experienced serious losses due to making this mistake. You absolutely must
carry out technical analysis with fundamental analysis on each and every trade.

6.
Thinking that past “wins” guarantee current profits

So, you’re last ten trades using
the same parameters and selections were all winners. Congrats! Now, don’t make
the mistake of assuming that if you open yet another using the same selections
that it too will be profitable. Yes, trading with the trend can result in a round
of easy profits, but each trend has to end a some point. Always remember this.

7.
Trading out of desperation

If you’re feeling a sense of
urgency to trade, then you’re likely better off walking away. Terrible
decisions come from trading during desperate times. Take a break, collect
yourself, and make a new plan before trading again.

8.
Failing to follow the process

Although each trader may use their
own strategies, there are general steps that all traders should follow when
trading. Skipping past some of these (particularly analysis) can result in
losses. Follow the process laid out by the successful traders who have come
before you if you want to have the best odds of being successful.

9.
Making unplanned changes to live trades

Just because trading platforms such
as the MT4 platform provided by EagleFX allows for changes does not mean that
you should make them. No doubt, strong emotions can come from watching price
movement during a live trade. Acting on these can cause problems though, so
unless you are 110% positive that you’re doing the right thing, leave your open
trades alone!

10.
Entering the market after an optimal entry point has passed

Missed an optimal entry point? Move
on. Never assume that you can jump into a trade soon after a missed entry using
the same expected price movement and profit. Yes, it can sting to miss out on a
great entry point, but others will come along.

What truly sets the best forex
traders apart from the worst is that the best are those who have made mistakes
such as the ones mentioned above, but took action to correct them going
forward. Those who do not do this may end up making the same mistakes over and
over again, eventually draining their trading account.

Select a top-tier broker such as
EagleFX, establish a solid plan for trading, and make corrections when
necessary. If you do these things, you can expect to come out on top.

This article was submitted by EagleFX.

ForexLive

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