If you have just inducted yourself to the world of Forex then you should be aware of the need to learn the basics of the market—how this particular market operates, what exactly do certain terms (like Ask Price, Bid Price, Spread etc) mean, when you should stop placing further bids, how you should read market charts among other such attributes. Making mistakes is a part of your trading/learning experience. However, learning about ways to avoid those mistakes is part of your learning curve as well. While there are a few mistakes which you can learn while you are trading there are others about which you can educate yourself from the online guides. Today, we have compiled a few trading mistakes. Familiarize yourself with these mistakes and avoid them so that you can pave the way for a more flourishing trading future for yourself. You can refer to fibo for further insights. However, before that please go through the post in order to be duly informed.
Forex Trading Mistakes which you Should Avoid
The tendency to start trading right after a piece of news hits the headline
Be on your strongest guard against hopping on board after a prominent news headline. In such scenarios if trades are executed without being backed by a solid plan then it would be considered as good as a rash gambling move. Even a hair-pin turn in the sequence of events can result in huge losses for you. The correct way to trade would be to wait for the market to subside and develop a consistent trend after the news comes out.
Being overwhelmed by emotions
A huge mistake! You might as well have been told that you are not supposed to give in to emotions since that jeopardizes your trading moves in a major way. We will go a notch higher by saying that it is the market which should be treated be as an infallible source having the power to exploit your emotions and drive you to doom. Do not let your emotions rule your game. If you are trading for all the wrong reasons (to bounce back after a financial setback, to repay your home loans etc) then you stand more vulnerable to emotional extremities.
Not choosing a broker carefully
We aren’t really saying that the choice of the broker will go on to make or break your fate as a trader. However, you should be serious enough to conduct a thorough search on the background of the broker before availing its services:
- For how many years has the company served in the market?
- Is it offering any special feature when compared to other brokers?
- For how long is it allowing beginners to practice with the demo account?
- Does it have a good reputation in the market?
Consider these points carefully before settling for the services of the broker. In order to gauge the reputation of the brokers you can join the forums and ask the members whether you should consult a particular broker or not.