Avoiding the most common mistakes in the trading

Jul 23

Avoiding the most common mistakes in the trading

New traders always want to make a consistent profit in the Forex market. They even buy an expensive trading system from professional Singaporean traders just to make a decent living out of trading. But do you really think they can change their financial life? The simple answer is no. It requires an extreme level of hard work and patience to understand how this market works. You need to trade the market with proper money management to protect your trading capital. According to recent statistics, more than 90% of the retail traders are losing money. Today we are going to highlight the most common mistakes committed by rookie traders and give you some amazing tips on how to avoid those mistakes.

Executing too many trades

Overtrading is very common for rookie traders. By executing more trades the new traders want to make more profit from this market. But do you really think this will help you to make more money in this market? You need to rely on quality trade execution. Instead of trading the lower time frame data, focus on the daily and weekly time frame. Forget about low-quality trade setups and try to develop a unique trading system so that you can easily make a profit at any market condition. Being a rookie trader you need to follow a paper-based trading journal since it will keep you from overtrading the market. Write down the details of each trade since it will help you to take proper steps.

Trading against the market trend

You need to create a trend trading strategy to make consistent profit from this market. Try to learn the proper use of the advanced tools available in your online trading platform. Never trade the market against the trend even though you might have some good trade setups. Trading is all about finding the best trades in favor of the market trend. Stop thinking about short term profit as it always results in heavy loss. Being a new trader you need to develop a strong mentality since it will help you to trade with the market trend.

Trading with the low-end broker

The low-end broker always makes things hard when it comes to the trading business. But the rookie traders always think the low-end broker will offer the best trading platform in the market. Unlike novice traders, the pro traders always prefer to trade the market with brokers like Saxo since they always offer a premium trading environment to the retail traders. Never think you can make a living out of trading by trading the market with a low-end broker. Chose a broker like Saxo so that you can easily make a profit at any condition.

Relying on the indicators reading

Those who really on the indicators reading can never find high-quality trade. Indicators are nothing but the helping tools. You need to find a simple way to filter out the best trades based on raw price data. This doesn’t mean you are suggesting you not to use the indicators. Use one or two indicators at the initial stage since it will help you to make a better decision. Don’t start to trade the market with real money unless you can make consistent profit in the demo account. Try to use the demo account so that you can learn the proper use of indicators.

Conclusion

Becoming a successful trader is really easy. If you can follow the basic guidelines of investment you will never have to blow up the trading account. Try to avoid the most common mistakes mentioned in this article and follow a written rule. Try to learn the three major parts of Forex market analysis so that you can make consistent profit at any market condition. Never trade the market with huge risk to make quick profits.