The most common mistakes of a trader.

[Marcus Reilly]

1) Not having a trading plan: Yes, according to my research, I have discovered that most of the new Forex traders start their real trading journey with any professional trading plan. So, they take their decisions instantly in their trading.

2) Not having money management knowledge: It’s true money management is very popular word in Forex business. But unfortunately most of the traders don’t know the proper way of money management and risk management as well.

3) Not using protective stop loss orders: Yes, we traders always need to set our stop loss and take profits order in a logical level. If we set our SLs and TPs according to our personal choice then definitely we are going to face big losses.

4) Taking small profits and letting your losses run: I have seen, most of the Forex trader close their good trade as earlier nearest support and resistant level but they carry their wrong trades for longer sessions.

5) Overtrading: If you are a new Forex trader never open so many trades in different trading instruments in a same time. You should go step by step. In addition, definitely over trading is another very common problem in Forex business so, be careful.

6) Not having patience: You have to realize that, good entry points would be available here and there. So, when you may not get good entry point then you need to wait for a golden opportunity. Don’t be silly.

Whatever, I hope all members of this Forum will be able to avoid those common issues and best of luck for all of you.

[Zachary Davis]

Among the mistakes you highlighted that Forex traders make, I think the failure of the Forex trader to have a good money management technique is the worst among these mistakes. Also, not using an effective stop loss and not having a trading plan are also important.

Basically, money management is the ability of a Forex trader to consider risk foremost before profits. Money management when effectively adhered to, allow a Forex trader to risk a certain percentage of the trading account balance with each trade. It is the money management technique that actually helps a trader to limit or control losses effectively. It is therefore important that not more than 1% of the trading account balance is risked in any one trade.

The stop loss placement is another issue that is also relevant. Every Forex trader should try to make use of this order because the market is not predictable and spikes could occur at any time that could wipe out a traders account.

[Ricard Dorman]

Poor money management is one of the common mistakes Forex traders make in trading. Some Forex traders simply do not know how to manage invested funds while some of those who know, are just not patience to apply the money management because they want quick gains. Once trading funds are properly managed, then the possibility of getting rich over night is not possible. What can occur is a gradual increase in the profits realized by the trader. This is what money management does and as the profits begin to gradually increase, the risk is also put in check.

[Shane Watson]

Somehow I am guilty of some mistakes in the list and even make the same mistake until now, but I’m still not have any plans on stooping those mistakes. The reason is very simple. Because, I don’t have any other way to augment that mistake. I mean for example, ‘Over Trading’. I do this sometime for minimizing my losses. Now I know it’s a mistake but will I going to replace this approach in order to have a better approach? Lack of alternate approach make me to decide to continue doing this as I kind find a better way to replace this mistake. In short for me this is the lesser evil.

I still do try to make sure that I minimize my mistakes. But as long I can’t find a good solution to the mistake I make I still going to continue doing some mistakes until I find way to make it better. In addition, somehow and so far even though I make many mistakes I’m still happy that I end up making some profit month after month. I guess it’s not a mistake at all.

[Andre Silva]

Mistakes are always made by the traders when they are trading here as no any traders can be a perfect Forex trader. Some new traders think the way that if the experienced traders are there then that means that they don’t make any mistakes at all and they don’t lose also in the trades. But even the experienced Forex traders are also losing a lot when they are trading here. So, all of the traders may always be losing when they are trading.

It is not only the new traders that are losing sometimes even the experience traders lose, so if the traders do not want such mistakes when they trade then they also need to first at least understand the trade market well. In addition, if the traders fail even on that then the traders may never be having any good time during their trading too.

[Steve nison]

All mistakes are the most ones of many traders but in my opinion, not having patience, lack of proper trading plan and not having money management are the most basic and worse mistakes made by traders specially new traders! You have described almost all the basic mistakes of traders it is very nice of you buddy! It seems you have a lot of experience in Forex trading.

If you do not have proper money management and a proper trading plan then it is almost sure that you are not going to become successful in trading Forex. Forex relates to how you take Forex and especially if you are taking Forex as a place where you are going to just earn then it is going to be hard to trade well and with good deal of profits. You should try to make Forex as a clear place where you are going to test your new strategies and also earn from them.

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