6 reasons to lose your trading deposit in forex - how to prevent it.Barry Copeland 10 / June / 21 Visitors: 88
Many beginning traders lose their trading accounts during the first year of work at the market. There are many reasons for the loss of a trading account, but the main ones will be considered in this article.
Lack of necessary training for trading on the market. At first sight, it seems to be simple, you have to buy cheap and sell expensive. This simplicity attracts many traders. Exactly, lack of understanding of processes, occurring on the market, leads to the situation, when a beginning trader thinks that he can cope with this activity and eventually loses the most or all of his trading account.
Lack of trading system which each trader must have. The beginning traders neglect the trading strategy, which can be available, but not tested on the history and demo account, as well as not adapted for themselves, due to lack of experience. In fact, trading in the market is based on intuition, or random market entries are made, which immediately affects the balance curve of the trading account.
Emotions during the trading process, as there is no clear algorithm of making trading decisions according to which you can make deals without emotions. The beginning trader cannot cope with his emotions, which leads to negative results in the trading account.
Non-observance or systematic violations of the trading system rules. This happens due to lack of discipline, which is a necessary quality of successful trader. Undisciplined actions are a sin both for beginners and experienced traders. It is necessary to learn to be a disciplined trader, as only he/she achieves success on the market.
Changing of a trading instrument, the statistics on which the trader does not have. This leads to uncertainty in his actions on the market, which negatively affects the trading deposit. In order to work on the market profitably it is necessary to know the nature of trading instrument movement and to be able to react on these changes in proper time and receive profit.
Changing your trading decision under the opinion of more successful colleagues, a reputable analyst or information, which seems more accurate than your signal from your own trading strategy.
To summarize, it is worth noting that knowledge of these reasons will help you protect your trading deposit from loss and help you develop in your chosen direction. You should realize that everything comes with experience, and even the loss of the first trading account should not stop you from striving to become a successful trader. You just need to survive the loss of the trading account, make the right conclusions and move on.