If you want to learn forex trading correctly and make money, you need to avoid basic errors made by the majority of traders, if you want to win so make sure you read and understand this list...
1. Automated Forex Trading Systems
Great idea and very appealing simply plug it and make money while you sleep the reality though is you are likely to lose. Most forex robots simply don't work. Why? The track records are always made up in hindsight with knowledge of what happened. That's easy, if we all knew tomorrows price today we would be rich but we don't. You don't make a big regular income for the price of a meal out and that's a fact.
2. Day Trading and Scalping Systems
Most you see sold are simulated like the robots and it's a fact that all volatility in short time frames is random, so this form of trading is a real mugs game. It looks low risk but is actually high risk, as the odds are against you.
3. Leverage
Sure it's an advantage - but most new forex traders leverage up to much and lose. Just because a broker gives you 200:1 leverage, doesn't mean you have to use it! 10 - 20:1 is enough for most new traders.
4. Failure to Accept Big Gains
Most new traders don't have a problem setting a stop and taking a loss but they have a problem accepting a big gain. Why? All traders want big gains but running a trend is hard, especially when open equity is dropping. Most traders jack the stop up to close, get stooped out and then see the trend make thousands of dollars and their not in! You have to have the discipline to keep your stop back and accept draw down in the short term to bank a big gain.
5. Listening to experts and trading the news
Those analysts on CNN and CNBC maybe wise and they maybe clever - but there not traders. You can't trade the news, as it's immediately discounted and to prove the fact, most markets collapse when there most bullish and rally when there most bearish. The market price is made buy traders, therefore the news is unimportant; it's what traders think of it that counts.
6. Trying to be to clever and working to hard
Most forex traders are lazy and think they can make no effort and win and of course they get taught a lesson however, those traders who think be clever and working hard counts also fail.
You don't get rewarded for working hard or being clever you get rewarded for being right with your trading signal and that's it. The key is to work smart, get the right forex education and you can win with less effort.
7. Trying to Use Science to win
Doesn't work, as markets are not scientific. Think of all the advances we have had in the last 30 years - in forecasting methods, news and analysis, yet still 95% of traders lose. This means it doesn't help! Markets are and always will be an odds game and if you try clever, scientific theories, you're barking up the wrong tree.
8. No Discipline
Most traders are not disciplined and hate trading through losing periods - but you must do this to win. You get discipline from a sound forex education and confidence - that's why you can't follow others to success.
9. Trying to Buy Low and Sell High
Traders are obsessed with this and want to buy market tops and bottoms but this is not possible. Try predicting them and you will lose. You need to trade the reality of price change only and really you should be trading breakouts to new highs or lows as most major trends start from them.
10. Not Knowing Your Trading Edge
Why should you win when 95% of all traders lose? To win you need a trading edge and if you don't know what yours is which will allow you into the elite 5% of winners, sorry you're going to lose, as you don't have one.
If you understand the above you will see forex trading is simple and you can win - but you need a disciplined mindset, a simple forex trading system that trades the odds and a trading edge.
If you want to you can enjoy currency trading success you can, as everything about it can be learned and forex trading can give you a lucrative second income or even a life changing one if approached in the right way.
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