Common trading mistakes: part two

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  • #8899
    blankfreeforex20
    Participant

    Common trading mistakes: part two

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    Overreliance on software
    Most people use some form of technology to assist their trading.

    For example, you might study chart patterns or use automated alerts and algorithms as prompts to trade.

    But, as useful as all of these tools are, it is important to remember that they are only tools, and must be employed wisely.

    Just as your satnav can occasionally direct you to drive into a deep torrent of water because it doesn’t know the river has flooded, trading technology isn’t something to follow blindly. You still need to keep your eyes open and react intelligently to the signs you see.

    Car
    So when using technology, such as charting software or other analysis tools, it’s important that you understand the underlying concepts and the reasons behind what the charts are telling you. This will allow you to see the bigger picture and avoid unnecessary mistakes.

    Lack of record keeping
    Do you remember your first trade? What about the third, or the fifth?

    If you’re new to trading, the details may still be clear in your memory. But in a few months’ time will you still be able to describe each step and decision in detail?

    Unless you keep a trading log or diary, the chances are that this information will be lost. And if you can’t remember what you did right, how can you replicate it? Similarly, if you don’t know where you went wrong you could easily make the same mistakes again.

    Your trading diary will let you look back at your experiences with the value of hindsight and learn from them. So what should you record in it?

    Question
    Which of the following is NOT worth putting in your trading diary?
    A
    Why you decided to trade
    B
    What you were wearing at the time
    C
    Where you placed your stops or limits
    D
    How you felt at the time you opened and closed the trade

    Reveal answer
    Bad timing
    Timing is not only the art of good comedy – it’s also central to good trading.

    In the same way that a stand-up artist needs to deliver the punchline at exactly the right moment, you need to time your entry and exit from a market perfectly to maximise any profit or minimise any loss.

    Timing mistakes are common among new traders. So how can you avoid them? Although getting your timing right isn’t an exact science, there are a few tools that will help you to act at the right moment:

    Chart analysis will help you forecast potential scenarios by revealing market patterns
    A trading plan will help you to define your strategy, meaning you’re more likely to avoid impulsive actions
    Stops and limits will allow you to go about your business without having to monitor the markets constantly
    summary
    Remember the limitations of software and use it intelligently
    Keep a trading diary and reflect on the strategies that have worked well (or not so well)
    Use tools such as charts, stops and limits to help you get your timing right when opening and closing positions

    #10901
    blankRob Dowel
    Participant

    There are some common mistakes which are occured by most of the traders. One of the most important mistakes is to choose a good broker. Choosing a broker can be the most important thing in forex market. A good broker like TP Global FX can help you to make profit consistently. It can also help you to minimize the risk by its trading tools and techniques. It can help you by giving high leverage to make a huge amount of profit.

    #13438
    blankRobert
    Participant

    One of the most important forex strategy is to think with your mind not with your heart. Emotion can put you in danger in forex market. Another strategy is to pick up a broker which gives a lot facilities in the trading. I use Tpglobalfx for their low spreads, dynamic leverage and quick customer service. They provide tight spreads starts from 0.01 pips. Their maximum leverage is 1:500. They give me 24X5 customer service. So, in my trading career they play an important role.

    #19998
    blankChristiano
    Participant

    Trading is not an easy task. Every trader can not make money from this market. Many traders lose their money in this market. The main reason of losing money is to take the wrong decision at the wrong time. As a trader, I always made that mistake. But when I find FOrex4you as my broker, my losses turned into my profit. They always help me to make profit and minimize my risk.

    #25762
    blankManfredo Trentini
    Participant

    The most common mistake in the forex market is trade with the wrong broker. Choosing a reliable broker is not an easy task though. If you want to start trading then you have to find out a reliable broker. You can’t survive in the forex market without a reliable broker. A reliable broker is very important for a trader. I trade with Eurotrader. They are a very reliable broker. I would easily suggest this broker if anyone looking for a reliable one.

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