- Richard Casidy
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Do not try and beat the market!
The market is not something you beat, but something you understand and join when a trend is defined. At the same time, the market is something that can shake you out if you are trying to get too much from it with too little capital. Beating the market mindset often causes traders to trade against trends and overlords their account which is a sure recipe for disaster.
Failure to Manage Risk
Risk management is key to survival. You can be a very skilled trader and still be wiped out by poor risk management. Your number one job is not to make a profit, but rather to protect what you have. As your capital gets depleted, your ability to make a profit is lost.
Solution: Use stops and move them once you have a reasonable profit. Use lot sizes that are reasonable compared to your account capital. Most of all, if a trade no longer makes sense, get out of it.
Greed
Some traders feel that they need to squeeze every last pip out of a move. There is money to be made in the Forex markets every day. Trying to grab every last pip before a currency pair turns can set you up to lose the profitable trade that you are trading.
Solution: It seems obvious, but don’t be greedy. It is ok to shoot for a reasonable profit but there are plenty of pips to go around. Currencies move every day; there is no need to get that last pip. The next opportunity is just around the corner.
Buying a System
There are many “Forex trading systems” for sale on the internet. Some traders are out there looking for the ever elusive “100 percent accurate Forex trading system”. They keep buying systems and trying them until finally giving up deciding that there is no way to win.
Solution: Accept that there is no such thing as a free lunch. Winning at Forex trading takes work just like anything else. Build your system (or if i may add, buy from me lol) and stop buying worthless systems on the internet.
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