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How to avoid trouble when trading
Forex trading generates almost all the available kinds of emotions; fear, greed, hope, despair, joy. Trouble is one of the emotions that accompany trade, but it should be avoided. In grief and so little pleasant, moreover, they are practically deprived of any positive properties. Disappointment quite capable of destroying Your faith in the success and limit Your abilities.
But in fact there is no need to be upset in the trading process. If You are actively traded, from time to time You will lose, so it is best to create a balanced approach to this reality. Thus, You keep a cool head, and lost transactions will not be able to affect You in a destructive way.
Let's try to define those rules, the observance of which will allow You not to regret the losses:
Open long positions in a bull market and shorts in a bear
One of the reasons of losing money in Forex is trading against the trend. But if You go long under the domination of bulls in the market, You're doing it right. Every time You buy on dips in a bull market, You increase your chances of success, and that's fine. But even this does not always work, is a fact of life.
Follow Your plan
Regardless of the circumstances, if You have prepared a trading plan in the morning, and follow it all day, You will have no cause for regret. Try to make sure that Your training did not occupy all my free time, because You need to trade, and rejuvenate. But if the plan doesn't work, it means You should be more careful to think through it and adjust after a consistent and candid analysis of Your failures.
The ratio of "risk/reward" needs to be justified
Sometimes a potentially "good" deals don't work, but "bad" sometimes end up winning. Consider the probability of winning, but do not forget about the op. If You open a trade, in which 20% probability of success, but it can bring You 200% profit, then do not hesitate. In the long term such a strategy should bring You the victory.
The correct position size
If You get too greedy and risk more than usual, then You are making an unforgivable mistake, thus violating its own rules. This may cause for regret. But if You follow your normal risk management strategies, You play "their" game.
There is no point to regret the deal, if You stick to your plan to manage the risks. And even if violation of the rules can lead to significantly greater profits, there's no apology. Compliance with risk mitigation strategy is justified at least for two reasons:
First, the appropriate level of risk allows you to work freely, without unnecessary stress and indecision. Secondly, properly chosen ratio of "risk/reward" allows Your system to maximize its long-term potential.
If You follow all their rules and their signals hard to follow a clear strategy of money management, then You have no reason to regret the unsuccessful transactions.
|Category: Forex | Added by: (29.10.2017)