We’ve all made mistakes.
Mistakes are natural, a human element and a good process for learning. Likewise, we as traders, may have ignored financial arrangements, turned away from the plans we had compiled, or were too eager to aim for big profits that led to losses.
This bitter experience ultimately trains us mentally from beginner trader to professional or experienced trader.
Traders who have gone through a lot of experience have structured work characteristics, such as a structured plan to enter into a transaction, the right time to enter and exit, a measurable amount of capital to invest, and the maximum loss that can be borne.
On the other hand, novice traders do not yet have the mindset needed to become a successful trader. Novice traders can’t read the situation accurately. Especially for traders who are new to the world of Forex where the market is open around the clock which makes Forex trading a flexible investment option. In addition, Forex does not require large capital and also many Forex brokers offer high leverage.
However, beginners are often complacent about flexible times, small capital, and high leverage. The absence of a neat working method will only make these various advantages of Forex trading a waste.
Beginner Trader Mistakes
Here Finex will describe common mistakes that are often made by novice traders.
Expectations Are Too High
Most – if not all – people trade to increase the funds in their accounts. This is natural. But to think that we can do it quickly is the basic mistake of a beginner.
Set realistic goals or your efforts will end in disappointment. Understand that there are processes and methods that must be followed to achieve a goal.
Trading without a clear plan
The best way to get what we want – in this case profit – is to implement a plan as a means to achieve that goal.
Novice traders enter into transactions relying solely on intuition or feelings, not a detailed strategy.
With a strategy, we will achieve profit consistently. We will be able to find better opportunities and maximize our position.
What should be remembered, making a plan is meaningless if it is not executed or changing it halfway when the situation is not on our side.
Not Using Stop Loss
One sign that you are not planning is to not use risk management such as stop-losses. In fact, this command can automatically limit your losses.
Not using stop-loss means that your position is volatile depending on market movements or is open to all risks, including the risk of large losses.
By implementing risk management such as stop-loss, it is likely that your win-to-loss ratio will be even greater.
Tempted to High Leverage
Leverage and Margin allow you to trade with larger amounts of funds than your actual funds. But that doesn’t mean you can use it without a clear and consistent strategy.
Read how margin works and how it relates to leverage in order to increase your profits.
It should be remembered that in addition to potentially increasing profits, leverage can also increase your losses. Therefore we must have a plan that brings us closer to profit, not the other way around, even if we do not use excessive leverage.
The use of high leverage will only put a high burden on the mind of a trader who is not mentally prepared – usually a novice trader.
How to Minimize Errors
Nothing is instant in this world, especially for a great cause. It takes time to mentally form as a professional trader. Always believe in a long-term process that will transform you into a person you may not have imagined before.
Or yes, you’ve imagined it. Maybe you’ve wanted success for a long time. Whoever you are, Finex has already told you good tips to follow in Forex trading for beginners, as well as things to avoid.
To be successful in any field, including Forex, requires learning or education at some point. How we try to understand the market or technical things such as using indicators cannot be replaced by anything.
Maybe you’ve made a mistake, make it a positive experience that will make you think in a more structured way.
For those of you who are just getting started, this is the perfect time to record your journey with a trading journal.
Keep your psychology, don’t be influenced by failure after loss, because that’s part of success. A failed plan to achieve sustained success is better than a temporary victory that relies solely on luck.
Let’s together achieve the success you want.
Trading Forex, only on Finex.
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