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What mistakes can I avoid while trading Forex?


Help me understand about the mistakes that I can avoid while trading in Forex?

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Hello Stella,

Forex market is an exciting space for many investors, more so if you have an internet connection at hand. You will need to open an account to trade, but if you do not have trading skills in this market, it is best if you opened a demo account to learn before you proceed to invest real money.
Without the knowledge of Forex trading, you can make many mistakes that can cost you a fortune. You need to know how to avoid these mistakes whatsoever.
If you use extreme leverage while trading on Forex is a Good Idea, you can use them, hoping that you will make greater returns; however, extreme leverage may result in huge losses.
Not having a trading plan will also cost you. Having one is essential in Forex trading since it will entail your objectives, the strategies you intend to use, and help you minimize risks that you may face.
Avoid over trading at all costs. While you are placing multiple trades at a time, you may improperly place the trades. Few exchanges at a time are best convenient since you will concentrate much better, and the chances of making great profits are high.
Not following a given trend depending on the period you want to trade will also cost you. Following short-term trends for long term trading purposes will minimize your profit-making chances.
Emotional trading is another mistake you need to avoid. It can result in you making wrong trading decisions, one reason why people make losses in Forex trading. This also comes along with being impatient and lacking discipline while trading. You will only make gains if you are patient enough on the market and have proper discipline.
You also need to avoid using automated software to predict the market trends, especially if you are a beginner in this market. This software is hardly useful for future predictions. 
Many other common mistakes can bar you from being successful in this market. consider following these steps to up your gain in Forex trading.

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Hi Stella,

As we progress with our normal lives, it is evident that we make mistakes. Making mistakes is
not a crime, but failing to avoid these mistakes is. When forex trading, there are several mistakes
traders make, which at times end up leaving you frustrated. Beginners with little knowledge
about trading mostly find themselves in a tight spot because of errors that could have been
avoided. It is best for you if you familiarize yourself with the mistakes which traders do and
figure out how you can prevent them.
Lack of a plan.
When doing anything in life, all of us usually come up with a plan. Failing to plan is planning to
fail. Before you start trading, do some research an analyze your data to come up with a well
detailed and eligible plan. Your plan should have in it the strategy you will use when trading,
how you will get capital, and the software you will likely use when trading. Any business or
investment requires a well laid out plan to succeed; you cannot just wake up and start selling.
Lack of Stop loss
Even if you are sure that you will 100% gain profits, it is always advisable to set a stop loss. The
forex market is highly volatile, and even the smallest new can cause drastic changes in the
market prices. You can never know when this can happen, and therefore you should always have
a stop loss to ensure that you do not suffer when things suddenly go haywire.
Adding on to a losing trade
When traders see that a trade position is going to be lost, they tend to add more funds to it so that
it does not work in a loss. This practice is not healthy since you can end up making decisions
hastily since you are under panic. Your judgment is overcrowded at the moment, and you end up
making chaotic decisions, which will inevitably lead to even more significant losses. Always
stick to your initial choice and if a trade leads to an injury, study the cause so that you can learn
from your mistakes. By doing so, you will have saved yourself the stress and shock after
realizing that you have been adding on an unprofitable trade, which has, in the end, made you
lose a lot of money. Life promises better outcomes if we learn from our mistakes.
Lack of risk management
Traders who only think of profits and don't set up risk management protocols can end up losing
everything. Do not allow yourself to feel only of benefits and lack a plan for risk management.

Always stick to the rule of 1% risk in each trade. If you manage to reduce potential risks, you
can stay in the game for longer and make more profit from forex trading.
Trading newbies have a cultivated culture that they can at least earn 20% profit within one year
of trading. This, however, is a fairy tale. Setting unrealistic goals will see you fail all the time.
You should hold your nerve while trading and bite that which you can chew comfortably. For
you to realize this kind of profit, you must be an exceptional trader with years of experience in a
trading education background.
Not paying attention to the latest news
This is what is destroying people when they are trading. Always read the latest news release so
that you do not make decisions which have been overruled without your knowledge. Keeping
yourself updated will allow you to make correct trading decisions, and you will be taking a step
closer to successful trading.
To wrap things up, traders should equip themselves with a plan before trading. Try doing a demo
before the actual trading. Issues of risk management and setting stop-loss parameters should also
be adhered to. Avoiding these mistakes ensures that you make money stress free and efficient.

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