Mistakes Made by New Forex Traders

[dhanpreet]

Follow these rules to avoid the most common forex trading mistakes:

 

1. Be humble enough to learn how the market really behaves. Don't storm in with the idea that you'll "beat the system" with your new way of looking at the trends or events affecting a particular pair or trade. You may be smart. You may even be smarter than half the traders out there. But that very intelligence can outsmart you! Ego is unwanted and unappreciated in forex trading. It will get in the way of you seeing the market the way it REALLY exists, instead of the way you BELIEVE it exists. A person who studies and learns these movements will beat an overly-eager investor bent on "beating the system" every time.

 

2. Be accountable for your own trades. If you follow a system or a guru who has promised you untold riches, you're heading down the wrong path. They all claim to make you rich, but none of them can guarantee it. You need to take responsibility for your own financial transactions and protect yourself from any fallout. This means, among other things, only investing what you can afford to lose.

 

3. KISS = Keep It Simple, Stupid! Some forex traders and books on forex trading present the idea that the more complex a system is, the better it will perform. Nothing could be further from the truth! In this world's fast-paced economy, changes occur at a rate too fast for a complex system to adjust and keep up. Use a simple system and make money. Complicate it and fall behind.

 

4. Patience, patience, patience! You need to stay objective and focus on those indicators that define trends. Many new traders will jump into forex trading with a certain system they've bought. When it doesn't make a profit for them, they jump to a different strategy and then another. They never really achieve measurable success. Instead, you need to have patience. ALL STRATEGIES FAIL SOMETIMES! This is important to keep in mind. There are normal fluctuations in the forex market as in any other financial market. Bad periods are followed by good periods. Stick with your system through the minor bad spots until it performs for you again. Decide ahead of time where your exit points will be and stick to it. You'll be more successful in the long run.

 

5. Last, but not least, avoid too much subjectivity. Use technical analysis, Forex charts and the like, but don't become dependent upon them exclusively. Avoid methods that use cycles instead of indicators of trends. Good indicators to use are MACD, RSI, moving averages, stochastic and Bollinger bands. These will keep you focused and emotion-free.

[omarelalfy]

but not least, avoid too much subjectivity. Use technical analysis, Forex charts and the like, but don't become dependent upon them exclusively. Avoid methods that use cycles instead of indicators of trends. Good indicators to use are MACD, RSI, moving averages, stochastic and Bollinger bands. These will keep you focused and emotion-free.

[rovi08]

you know whatever safest way that we can do, we cant avoid mistaken, especially if we were about to start this kind of field,

but i really appreciate this post, and served as guided for me.. But not guaranteed us to be free from mistaken.

[Nikhil]

Yes true that do mistake is very easy but without mistake is very rare and i think if we do mistake then only we learn and doing mistake and mistake i am still learning forex . but after reading the post its really good suggestion but i think to remember this we need real trade means practical knowledge .

[ellliottt]

Yes it's true that forex is one of the best way if you like to invest and make money, online or offline. Even if we know the fact the it involves risk, people are still investing in forex to earn big. Using the best strategies they learned just to win the trading

[mownabratadey]

I think, Mistake must be the 1st step for success, But besides we have remember to improve our trading style by correcting those mistakes, If we do mistakes everytimes then nothing would have done... For beginners many of us are trading with big quantity without any practice in demo which could cause only loss... & try with somehow low leverage & play safely by stop-loss tool....