It helps to know the mistakes that you commit. Knowing them gives you a chance to avoid doing the same all over again next time you begin Forex Trading Video Tutorials. Ultimately, being aware of how these mistakes happen gives you the chance to redeem your trading career.
However, what if you are not aware of these mistakes? That means you’ll do them over and over again before you finally realize that something’s wrong, usually when it’s already too late and you’ve already put most of your trading capital in jeopardy, if you haven’t lost all of it.
That’s why we listed the following most common mistakes that beginning traders commit when they start trading. Read on and know about them—and avoid committing them!
Letting Your Losses Pile Up
A successful trader can take a small loss almost instantly and then try out another potentially profitable trade.
For beginning Forex Market traders, on the flip side, it’s not always easy to accept the fact that they have just lost a trade, much less to move on when it’s time to move on.
They usually get paralyzed when their trades go against them, thinking maybe it isn’t the end and it isn’t the time to let go of the trade. They stick to it with blind hope that something will happen that will turn the trade around to their favour. Unfortunately, what really happens is that they pile up their losses and they let it happen right in front of them.
Ignoring Stop Loss Orders
If you really want to become a successful trader, you have to understand how stop loss orders work and how to use them properly in your trade. One of the biggest mistakes that a newbie trader commits is the failure to use stop loss orders.
Some don’t know what they are so they don’t use them. Others are simply not sure if they need it, while many more understand them and know that they need it, but they don’t use it anyway.
Remember that stop loss orders serve like insurance for your trades, putting a stop to the trade once a predetermined amount of loss has been reached. This is its primary benefit: you get to know how much you can lose in a specific trade.
It also removes the emotion from trading, letting you focus on the steps you have to take during and after the trade has been finished.
Failing or Deviating from the Trading Plan
One of the greatest quality of a successful trader is the ability to always have something up his or her sleeve, meaning he or she always got a backup plan in case his or her initial plan failed.
The opposite of that is the worst quality of a newbie trader. Trading without a plan is like demanding to win the lottery without betting and without knowing how it works. Others do have a trading plan, but they deviate from it at the very first chance they get, thus lacking the trading discipline that many successful traders have.