Share This Post

Forex Trading Tips

How to Stop Being Your Own Worst Trading Enemy

Forex Trading Tips

How many times have you just wanted to kick yourself because you exited a trade for a loss before it hit your stop loss, only to see it take off in your favor without you on board? Or, how many times have you felt the extreme frustration that comes with giving back your recent trading profits to a trade that you knew was ‘stupid’ before you entered it?

How to Stop Being Your Own Worst Trading Enemy

Trading can be thee most frustrating profession in the world, if you let it. The less ‘unforced errors’ you make in trading, the better you do, just like tennis. The worst way to lose money in the market is by doing something that you know you shouldn’t do, but do anyways. We are all guilty of them sometimes, the key is to limit these unforced errors as much as possible so that you are doing everything you can to put the odds of trading success in your favor, instead of shooting yourself in the proverbial foot.

‘Unforced Errors’ Can Destroy Your Trading Account

If you’ve ever played a game of tennis against a competitive friend, you know how maddeningly frustrating unforced errors can be. Essentially, an unforced error means that you ‘gave away’ the game to your opponent because of ‘stupid’ mistakes that you made, which were easily preventable.

Now, unless you’re Rafael Nadal or Novak Djokovic, you probably don’t have a lot of money on the line if you’re into recreational tennis, yet you still know the frustration of unforced errors. In trading, ‘unforced errors’ basically means making stupid trades / over-trading / over-leveraging your account. Except, when your real, hard-earned money is on the line, and becomes the direct ‘victim’ of these unforced trading errors, it can literally make you feel like you want to jump out of your own skin. I’m sure you know what I’m talking about!

Unforced errors in tennis, whilst still preventable, might actually be a little harder to control than unforced trading errors, because in tennis you are trying to control your entire body, and hitting the ball just a little too hard can send it flying out of bounds (unforced error), for example. In trading, unforced errors are entirely preventable because they are simply the result of a lack of discipline and logic. You can change the way you think about trading by making a conscious effort to do so and you can work on controlling yourself in the market better, so as to totally eliminate unforced errors from your trading. But you will have to work at it.

Trading is hard enough as it is, you don’t need to do ‘stupid things’ in the market that you know you shouldn’t do, you will have enough losing trades without doing these things. So, don’t make it any harder on yourself than it needs to be!

How to Eliminate ‘Unforced Trading Errors’

It’s going to take a conscious effort to have the focus and discipline required, but if you want to become profitable in the market, you have to eliminate the unforced trading errors that plague most traders. Here are some things to focus on that will help you reduce and eventually eliminate unforced trading errors…

MUST READ  How To Become A Successful Forex Trader

Stop closing trades out manually unless there’s a REALLY obvious reason to do so. Closing trades out manually before they hit your pre-determined stop loss is almost always a bad idea. Let the trade play out, if you don’t, you’re voluntarily eliminating the chance of profit and simultaneously implying that you know ‘for sure’ what the market will do next. This is both arrogance and ignorance! You have a trading edge (your trading strategy, e.g. price action), so if you enter on a valid price action trade setup, then you need to let that trade play out to have a chance to work in your favor. Otherwise, you’re cutting down its overall profitability / ability to make you money.

Stick with your initial trade idea and gut call. Don’t waffle and close out perfectly good trades soon after entering them just because the market moves against you a little bit. Stick with your gut feeling and trust yourself and your trading method! If you cannot do this consistently over time, you stand no chance of making money in the market because you will not have a trading edge, you will have nothing but a bunch of randomness and pointless actions in the market, i.e. gambling.

Stop jacking up your risk! Risking too much per trade is probably the quickest way to become your own worst trading enemy and is a very dangerous ‘unforced trading error’ to make. Trading too much (when your edge isn’t present) and risking too much per trade are the two biggest mistakes traders make and are the two most preventable trading errors. If you can simply eliminate these two unforced trading errors, you will probably start seeing profits build up in your trading account, over time.

Stop focusing on rewards and profits. What you should be focusing on is learning to trade properly and becoming a good all-around trader, because that is how you make money. Most traders get ahead of themselves and begin focusing way too much on profits and reward and day-dream about quitting their jobs or telling their boss to ‘shove it’, etc. This is really not constructive or conducive to becoming a successful trader because it simply diverts your focus from what really matters. Focus your attention on managing risk, preserving your trading capital, and becoming a master of your trading strategy, and you’ll find that the profits begin to take care of themselves.

Stop looking at lower time frame charts. Unless this is your first day reading my blog, you know I preach the power and effectiveness of higher time frame trading. There is just no need to analyze any time frame under the 1 hour chart. These low time frames are also low-probability and do not give you a significant perspective / view on the market, and they are just too ‘noisy’ and unpredictable. Remember…don’t make trading harder than it already is! Trading very short time frames, like those under the 1 hour chart, is doing exactly that!

Stop over-analyzing unnecessary variables. Traders typically spend way too much time analyzing the charts and looking at unnecessary variables. Trying to trade the news is perhaps the single biggest waste of time and over-analysis mistake made by traders. People have different views on news trading and some don’t agree with me on my views, but the fact that the price action reflects all variables that affect a market, is simply a fact and is indisputable.

MUST READ  Cure Your Trading Problems by Admitting You Have Them

Make a conscious effort to remind yourself of what your trading strategy is, stick to it and track it. This means having a trading plan and actually following it, as well as having a trading journal to record your trades. A trading plan can simply be a checklist of what you’re looking for in the market and maybe even trading affirmations / reminders to stay disciplined and to not deviate from your risk management plan or your trading strategy. All of the things that you know you should do in trading, should be included in your trading plan and they will act as a reminder of what you need to do to succeed. Eventually, these things will become habit, but to build that habit, you need to follow the trading plan.

Conclusion

The primary reason most people fail at trading is due to ‘unforced trading errors’. If you simply get out of your own way, and let your trading strategy and the market ‘do the work’, you will stand a far greater chance of making money in the forex market.

Unfortunately, as humans, we seem to be ‘hard-wired’ to make the ‘unforced trading errors’ discussed in today’s lesson, and the only sure-fire way to overcome them is to make a conscious effort to do so. The tips discussed above are an excellent starting point. Of course, to ‘get out of your own way’ and let your trading strategy do the ‘work’, you first have to know exactly what your trading strategy is and have it ‘mastered’.

5 Tips About forex trading price action You Can Use Today

When you finally’ve discovered a trading fashion that matches your personality, it gets to be much simpler to find an appropriate strategy within that fashion.

Justin worthwhile data, I’m in the entire process of instruction and it’s been almost three decades of learning And that i’ve put in a number of months just committed to swing functions and my trading has improved ostensibly, don’t just with the psychological component but for the different way of looking at the market. I work a really small real account but I hope to extend it Down the road.

Most traders truly feel like they should locate a set up Each and every time they sit back before their Pc. This known as searching for setups.

Information and facts is gold and we consider the more you may have, the more you should share. That is why the only thing we inquire you to do (if you want what you’ve got read through) is always to share this PDF e book along with your relatives and buddies. If it served you, it can assist them too.

I utilized to Imagine swing trading and day trading is one particular and precisely the same detail,now I realize on which facet I belong,many thanks Jb

MUST READ  10 Tips to Build An Effective Forex Trading Plan

I happen to be missing out on earnings with my trades by not figuring out a goal. I’ve absent trough your Forex Swing Trading lessons which has cleared my mind but what I want to know is whether or not I must transfer my quit into the resistance or support spot once the price has moved further than

You should Notice that the demo does not account for commissions and costs that will be charged inside of a Reside account.

The next and 3rd chapters keep on to outline the trading markets generally speaking, thinking about the industry outlook along with the traits you must watch out for. Also in this portion we think about the crucial selections to make to start with within your inventory trading vocation.

Any activity from the economic sector, such as trading Forex or examining the industry necessitates expertise and strong foundation. Anyone who leaves this during the arms of luck or likelihood, winds up with practically nothing, since trading online just isn’t about luck, but it’s about predicting the marketplace and building appropriate selections at actual times.

This is where Individuals critical ranges arrive into play once more. Bear in mind that when swing trading the intention will be to catch the swings that come forex news trading tips about among aid and resistance stages.

Final Current 1st February 2018: Should you’ve at any time desired to get started in virtually any investing, whether or not this be inventory trading, binary or foreign exchange, you know that understanding the basics goes a great distance! We have already got a article on forex trading basics, but we decided to publish an in depth e book outlining accurately how you can find started trading forex in as little as thirty days.

As opposed to only having indicators that count on your candles or bars, you may create formulas that overlook the earlier and only center on latest see this here market place circumstances. It’s also possible to place as many charts when you’d like into a person charting window. Firetip X charting also supports Options forex trading website & Unfold charting.

Thank you sir. I like Keeping trade for some time and with this particular written content, I no it can help me turn into a better trader and swing trader.

Any viewpoints, news, exploration, analysis, prices, or other visit this site facts contained on this website is delivered as typical current market commentary and over at this website does not constitute investment tips. We won’t settle for legal responsibility for just about any decline or harm, including without limitation to, any lack of earnings, which can occur immediately or indirectly from the use of or reliance on this kind of information and facts. You should bear in mind that the earlier effectiveness of any trading system or methodology just isn’t necessarily indicative of long run benefits.

To be a general rule, price action signals turn out to be a lot more reputable as you progress from the decrease time frames to increased kinds.

Share This Post

Enhance your Forex Trading with BEST MT4 EA. 1800% Profit with Proper Money Management Advice & Less Drawdown. Order Now & Get 90% Special Discount.

Leave a Reply

IF YOU DON'T FIND A WAY TO MAKE MONEY WHILE YOU SLEEP, YOU WILL WORK UNTIL YOU DIE.

- WARREN BUFFETT