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The Pitfalls in Forex Trading to avoid


There are actually 5 main pitfalls in forex trading that can make you lose your fortune. If you can do what it takes to avoid these pitfalls, then you can be the winner at the end of the battle. Here are the 5 pitfalls that you must avoid:

1. The Contrarian’s Disease
Being different is not always a bad thing, especially in the forex market. When you see that many traders have lost money in a certain trend, you can initiate to take the opposition to get the profits. Many traders are often right in predicting the market movement, but they can end up losing money because they do not have enough discipline and good money management. Many of them keep waiting to get the tops and bottoms and neglecting the trend itself. You must avoid this dangerous pitfall. You need to realize that it is impossible to pick tops and bottoms because turning point is something unpredictable. Therefore, you need to focus yourself on following the trend, instead of trying to pick tops and bottoms.

2. Too subjective oriented
One of crucial tips in forex trading is to be objective rather than subjective. Another pitfall for many traders is that they spend too much time learning about the subjective methods and indicators, such as Elliot Wave, charts, cycle, moving average, momentum oscillator and so on. These methods and indicators are important in a way, but they can be best at their use if they do not make you to be too subjective in making any transaction deal.

3. The Ego
The obstacle to win in the forex market can be your ego. Even though you feel that you are so smart, you must determine what your main intention in the forex trading is. Is it to show how smart you are? Or is it to make some profits? You have to choose one between the two, because you will never get them both in a forex trading market. If money that what you seek for, then throw away your ego and if it is your ego that rules, then forget about making some profits from the forex trading. A humble trader, who does not boast to beat the market, can only focus in making money through the forex trading. Therefore, he can have a clear objective and discipline in executing the forex transaction.

5. Following Other People
There are times when you might hear about the story of someone who has succeeded in making money from forex trading. After that, it is very tempting that you want to follow the methods that he has been using. You should avoid this pitfall too. You need to understand that one method might not give equal result to two different people. Therefore, it is always a good thing if you as a trader can take all responsibilities for every action you make by your own rather than merely imitating others. The key to success in forex trading is you and only you.

6. Changing Methods
There are so many cases where traders get impatient with the method they have chosen because there is no good result yet. Therefore, they implement another different method in their trading. They might continuously change different method every time they think that it is not performing. It is definitely another pitfall, which you have to avoid. You must understand that there will always be good trading result after the bad ones. Your patience and discipline take into account here. You cannot just chop out a method when you think that it does not perform well instantly. If you keep on this chopping pattern, it is most likely that you end up losing more money, Once you have a trading plan that you have researched and believed to work well, then you need to give it time to develop. You must stay focus on particular method, instead of keep changing it.

To sum all of these, you need to have the right attitude and behavior in order to avoid these pitfalls in forex trading. You must be able to stick on certain method, stay focus, and dedicate your hard work on the forex trading. It is likely that you will get your success in the nearest future. Above all, you need to stay out of these 5 pitfalls to ensure your long term profits in forex trading.

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cXVpY2tpbnZlc3QubmV0L3dwL3dwLWNvbnRlbnQvd29vX3VwbG9hZHMvNC1xLmpwZyI7aTozO3M6NjE6Imh0dHA6Ly9xdWlja2ludmVzdC5uZXQvd3Avd3AtY29udGVudC93b29fdXBsb2Fkcy8zLXFpbG9nby5qcGciO308L2xpPjxsaT48c3Ryb25nPndvb192aWRlb19jYXRlZ29yeTwvc3Ryb25nPiAtIFNlbGVjdCBhIGNhdGVnb3J5OjwvbGk+PC91bD4=