- Common Forex trading mistakes to avoid
- Do not add to a losing position
Common Forex trading mistakes to avoid
1. Over Leveraging
Most unsuccessful trading experiences occur because of this.
Forex leverage offered worldwide varies, from 1:30 to as high as 1:3000 from time to time. Think twice before using the highest proposed level. ‘The more, the merrier’ is not always the right path to follow, when trading Forex.
Professional traders’ advice is not to risk more than 5% of your account balance or even lower.
2. Not setting an Entry Point
Trading is a science; therefore, it is essential to establish a specific strategy.
Write down your rules for entering a position and stick to them.
Most successful trades begin with a correctly chosen entry point.
3. Not setting an Exit Point
What guides you while trading? If it is just luck, try to think beforehand, what you would do if it went against you.
According to experienced traders, it is preferable to have a predefined exit point or a stop-order, which may sometimes save your account balance.
Open your Demo account with IronFX and practice the above mentioned.
Do not add to a losing position
It is essential for traders not to be afraid to re-evaluate their trading plans.
Nobody can predict the market moves and it is a common mistake of novice traders to add money to a losing position while expecting that it will change direction.
There are always traders who rely only on luck, but if you do not, it is preferable to calm down and change your action plan.
Any plan should always reflect settled goals. If these goals change, so should the strategy.
Practise on a risk-free Demo account and test your strategies with real trading charts.