Forex Market Success: What Traps to Avoid in Trading Forex
Throughout my many years as a Forex trader and as a Forex mentor, I have seen many things from newbies and people trying to "strike it rich" in Forex. Many traders get into the "Forex game" (that's what I call it) thinking that it is simply a stroke of luck that one needs and he can instantly become a millionaire. I have heard of countless people who have paid invested hundreds of thousands of dollars and spent about that much more to purchase a "can't fail" product from the so-called "experts" and in return have received the "Forex cracked code."
To those individuals who have spent all that money on that product and believe that you are well on your to receive your "pie-in-the-sky;" I would like to advise you that instead, you are going to be getting pie thrown in your face. What do I mean by that? It is simple - you just got "had." What I share with everyone who will listen is this cold, hard, honest truth - there is NO SUCH THING as a "holy grail" in Forex. There is no "one-size-fits-all" trading style - you either have it, or you don't.
Not only do those guys try to sell you a bag of "fairy dust," they also try to convince you that with their systems, it is virtually impossible to fail. They try to get you to believe that their system is basically "fail-proof." I hate to be the bearer of bad news, but I'd like to share this with you... if there was a system that was virtually risk-free and there were no inherent failure possibilities, why wouldn't the ones who are selling it to you be filthy rich? They would be using this process and, instead of selling it to you, they could afford to simply give it away - since they don't need the money, right?
So, now that we have established that preventing risks is not always possible, we have learned that it is still an extremely necessary part of your Forex trading career. You should try to minimize your risks at almost all cost - whenever it is. Time and time again, I have seen that bad trading discipline, particularly with amateurs executing the trades, can leading to high risks in investing with very high loss possible.
According to most Forex traders, I believe if they were asked what is the single most avoidable trap in creating extensive loss situations is simply not having enough risk capital on hand. Getting caught up in this one lonely trap can cause additional stress and lower your choices, especially when a drawdown period in a particular pairs occurs; therefore, your chances of making wise trading decision are pretty much slim to nil.
Every veteran Forex trader understands that poor money management, in whatever way it is presented, is always a negative thing. Sometimes, I've noticed, it is possible that even the most experienced trader, from time to time, may need a little help with a trade or two, just to get the best and most out of day trading. Here is the key: as long as traders attempt to improve themselves and place their knowledge and experience to work, it is possible to make a killing with day trading. Trust me!
Happy trading...