Common mistakes in trading
- Thread starter mumuy
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Yes I do agree, only due to lacking of proper trading plan mostly traders have been failing from this market place, the newcomers kick off their live trading without basic knowledge they fall a great trouble when trading practically, and they always ignore the demo account which always be full of exact basic knowledge
There are so many common mistakes in traders, few traders are greedy, few are full of emotions, few are not having knowledge about Forex. It all depends on different trader how they face the problems and solve them too.
Absolutely correct. 90% of the traders don’t take demo trading seriously and trade care-free. They fail to gain sufficient knowledge and ability to deal with losses and hence blow off their accounts. Need for proper trading plan is very essential irrespective of the fact that whether person is a newbie or already existing trader. However, in order to overcome the psychological drawback of the practice account one can also go for small real account which will give them true sense of trading as their real money will be at stake.
Because demo account has appropriate conditions for care free trading I mean from psychological side. Full trading simulation, large deposit and no own money is at stake. Making bets carelessly and some of them tend to be winning because of large deposit - same behavior translates in live trading with deposit which way lower and thus almost unprotected from blow-out when same risk is taken.
Careful risk-management what live trading teaches a trader and you are not able to gain that skill on demo.
Don't make this mistake. Losing traders waste a great deal of time predicting where the market will be the next day. Whereas, winning traders use most of their time contemplating how traders will respond to what the market is up to and they prepare their plan accordingly.
Exactly. Demo accounts give an imprint of trading in the live environment. Though all the trading conditions are same as live but one’s own money is not at stake. Careless trading in demo makes one suffer when they go live. It is very essential to understand the fact that optimum utilization of demo account for learning purpose is very very essential.
Most traders make the mistake of not accounting for volatility in their trade when deciding how much to trade. When they do this, they have unknowingly prepared themselves for the superintendent of all losses. They end up eventually blowing out their trading account. This must be avoided.
People think they can become an expert at forex overnight, it's about patience and learning how to trade, there are risks with every opportunity and learning how to trade forex before diving in would greatly minimise these risks.
For me a very interesting point was made that it's worth risking and accepting the loss of money in order that the deal be profitable in the end. In general I disagree with this expression, because it's acceptable only in the longterm, and not every trader can afford it.
The traders basically focus on only good trading knowledge, but practically despite of having proper trading knowledge that’s not possible at all to lead a comfortable trading life with certainly without having accurate money managements approach. So we have to emphasis on how to manage money in Forex.
Agreed! Money management approach must also be focused on by the traders as without it one would not be able to minimize the risk concerned while trading with real money. All the traders cannot afford huge loss of money and then still continuing to trade.
I agree that demo account have virtual money and the fund size is also big which is the reason that we always see our trades in profit. The best thing to test our skills is to trade with smaller lot sizes to see what outcome is achieved.
It's important to remember that the market is changeable. Today, the market is predictable, and tomorrow it insidiously violates technical analysis. It's important. It's important to remember that success is changeable.
Most of us including me believe the same unless blow up the account and learn with the past mistakes. If we take a look at the stats we can easily assume that the losers in forex trading are 90% and all of them losses due to the same belief that you have mentioned above.
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