With the world experiencing the worst economic crisis since the great depression of 1930′s, people worldwide are looking different ways of generating additional income. Forex trading is now fast gaining popularity among the investors because of the option of making fast money. But before making a dive into this tempting pool it is essential to learn forex market errors which will help you in making wise investments:
1. First thing to learn forex market is to avoid day trading or scalping if you are novice because of the current upheaval seen in the market. In short term trading it becomes very difficult to study the trend of where the prices are about to move in small time frame. This result in beginners loosing a lot of money in intra day trades.
2. To learn forex market don’t move with masses by reacting to news alerts and SMS from trading analysts as they are nothing but mostly hoax calls. Also the forex trade market pushes aside this news almost instantly and so planning your trading strategy based on these clues is surely futile.
3. You cannot be far from wrong if you feel that the market trends can be analyzed in advance by using different scientific theories. If this had an ounce of truth no body would ever loose any money in trade market. Even the most scientific and advanced forex trade theory of Elliot waves urges its users to make subjective judgments before making a purchase. So stop predicting in advance to narrow your losses.
4. Can I make money while am sleeping or picking up my kids from school as propagated by forex trading software vendors. Well the honest answer is NO. Almost 99% of the forex software makes prediction based on the hindsight data and are not able to deal efficiently in real time trading scenario making you loose big equity amounts. Therefore be doubly cautious while purchasing any forex trading software and read for line likes â€œsimulated in hindsight which is a sure sign for the software to be avoided. This is important to learn in forex market.
5. Apply the principle of KISS to forex trading that stands for Keep It Simple Stupid. In simple terms too many indicators to watch for before planning your trading strategy might not be a useful option as it will create an extremely complex system that is difficult to understand. Instead select two or three important parameters and monitor them thoroughly before making your kill.
6. Correctly learn forex market indicators that will prevent you from making huge losses. One of the biggest trading mistakes is moving averages by buying forex in dips. Moving averages is a sign of lagging indicators contrary to the popular belief, so gain a total insight of the forex trading world before taking a plunge.
7. To learn Forex Market trading you must go for acting smart and not plain hard work. You get rewarded for making right strike at the right time rather than spending huge amount and lots of time in front of your forex software.
8. Avoid taking over leveraging from your brokers. Take calculated risks but don’t go overboard and loose all your hard earned cash. This is essential to learn forex market.
9. You should know when to stop. This is essential to make profit and also to avoid making huge losses when the market crashes. Also you should have good money management skills if you want to make it big in the world of forex trading
10. Last but not the least, devotion, patience and concentration are key to success in forex trading. Don’t get emotional while trading and learn to quit when you are in the lead.
So earn big profits by avoiding these commonly seen forex trading faux pas which reduces your profit margins. Learn forex market trading by avoiding this error which can turn your trading experience to terror.
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