Beginners lose money because they have not enough knowledge about the market. Remember, to do better in any field, you have to invest your time so that you can gain the proper experience. However, it’s not true, if you have enough experience, you will not lose any trade. In the market, it’s not possible, traders will win all the trades. But, the experience will aid them to deal with the different patterns of the market. As a result, you might minimize your losing streak. However, being a newbie, you need to find the reasons for which you lose money. So, you can take action against these.
In this post, we will point out the actions which are accountable for the failure. If you want to face a winning streak in the market, you should read this article.
Not keeping the journal
Traders need to keep the trading journal so that they can improve their performance. A trading journal is the trade history of the traders which allows them to know about the previous measures. By analyzing the journal, they may know about their wrong steps which cause failure. But, this is seen, newcomers don’t keep the trading journal and so they do not aware of their major mistakes. However, if you want to establish yourself as a profitable trader, you must analyze the journal on a daily or weekly basis.
Newcomers start overtrading because of greed. For this reason, they can’t protect their money and fail to go in the long run. Being a trader, if you want to save your account balance, you should reduce your greed. Otherwise, it would be difficult for you to invest your money properly. Because of overtrading, traders can’t reduce their costs. Along with this, there is huge pressure and start to make the wrong decision.
So, being a trader, you have to act practically and invest your money wisely. Moreover, you should follow your plan so that you don’t take any wrong action. If you are not sure how to start trading, you should start learning things in demo paltfrom. Try it out here and learn the basics of the market by using the free resources at Saxo.
Keeping too many expectations
Some traders keep too many expectations from the market. For this reason, after facing failure, they become disappointed. Being a trader, you have to make sure, you have set a practical goal. After setting the goal, you have to make your plan according to it. Remember, in the market, you can’t make quick profits. So, you need to set a long-term goal.
Making emotional decision
Newbies make an emotional decision and face failure. In the market, if you can’t keep your emotions separate from the trading decision, you may face the repeated losing streaks. So, you need to learn how to deal with the emotions in the market. To deal with your emotions, you may take a break. However, many newbies think, if they can work for a long time, they will make huge money which is not true. If you work for a long time, but you can’t perform better, you will not get good outcomes. Moreover, you will become stressed and start to make the wrong decision.
Novice traders become overconfident after facing the winning streak. They start to think, they will not face anymore. So, they break their risk management rules and thus face a big failure. Remember, the market is totally unpredictable. So, if you are not aware of this issue, you may blow up your account balance. That’s why you need to take steps consciously in the Forex market.
These mentioned reasons are responsible for the big failure of the traders. So, as a retail trader, you need to become aware of these facts and take the right measures to avoid these. However, we also discussed some ways of solving these issues. You can follow these to run your trading process smoothly.