How to Minimize Forex Trading Losses
by Forex currency Day Trader Gregor Anton - http://www.ForexCurrencyDayTrader.com
Last week I had some very good trades. I wish they all would be , but lets face it, this isn't a get rich quick scheme. You will have losses. How you manage your money and minimize risk, and minimize losses will play a key role in becoming a successful Forex Trader.
Rather than looking at how to get the most pips and make successful trades, lets focus on minimizing your Forex Trading Losses:
* No Trade is a Good Trade - Patience is key. If the market doesn't make sense, stay out. Create a demo account and practice first. Only trade when you're 100% sure all your trading conditions are met.
* Don't Babysit Your Trade - Follow your trading plan, system, and strategy. Know your entry and exit condition. Don't stress yourself out and watch your pips fluctuate or worse, go into negative red numbers. Follow your plan, set your stop losses and take profits. Walk away or do something else. Let your trading system and plan take care of the trade.
* Don't Get Greedy - Fear and Greed will get you every time. Greed is an emotion and you want to keep your cool and stay focused on practical trading. Emotional and impulse Trading is Gambling.
* Save Your Emotions - Relax and you'll trade better. Even with the best of trading plans, systems, and strategies. And in my experience, especially with Forex Robots, Signals, and Alerts. Let your profits run, cut your losses, and be sure to stick to your system and strategy. Save the emotions for when you celebrate a good week!
* Measure Profit in Pips - Focusing on pips rather than profit in dollars is far better. $'s make it emotional, pips keep it strategic. If you're not comfortable trading bigger lot sizes, don't.
* The Trend is Your Fairweather Friend - And you thought it was your friend... It will change and according to some the Forex Market is Trending only 20% of the time.
* Set Goals - Know exactly how many pips you are targeting. How many good or bad trades you're going to stop at. Everyone has bad days... I go for a walk, eat some Ritter Sport chocolate, grab a Mocha at Waves Coffee, or change my scenery in some way that gets me away from Forex. Bottom line, have a plan! ...and follow it.
* Set Conditions - When are you going to enter a trade? Exit? What is your Stop Loss and Take Profit? What are the market conditions? Market hours? Will you carry over? Trade around news times?
* Economic Calendar - The Forex Market tends to become volatile around important economic news. This "noise" can really throw off your trades. Or it can help your trading. Either way, you need to stay on top of Forex News by checking the Economic Calendar at least daily.
* Manage Your Money - Only Risk 5% at most. If you have multiple trades, the sum should be 5% or less. Some people like 3%.
* Know Your Risk / Reward - How many pips are you willing to risk? Are you going to risk 200 pips to make 20? You want to risk less than you are bound to make.
* Practice Practice Practice - Open a demo account, thoroughly test your system, plan, and strategy. Your demo account balance after 1 month of trading will give you a good indicator of how well you've done.
* Practice Practice Practice - Open a demo account, thoroughly test your system, plan, and strategy. And please don't change it every day or hour and stop looking for that holy grail. Your demo account balance after 1 month of trading will give you a good indicator of how well you've done.
* Walking Away is the most important part of your day - We've all been there, a great trading day, week, or hour. x amount of successful trades, you've met your target and you're excited. Do yourself a favour. Walk away and end on a high note. The markets are quick to turn and in our over-excitement the simplest mistake can cost you all your profits. Just walk away and continue on another day! - 23196
Last week I had some very good trades. I wish they all would be , but lets face it, this isn't a get rich quick scheme. You will have losses. How you manage your money and minimize risk, and minimize losses will play a key role in becoming a successful Forex Trader.
Rather than looking at how to get the most pips and make successful trades, lets focus on minimizing your Forex Trading Losses:
* No Trade is a Good Trade - Patience is key. If the market doesn't make sense, stay out. Create a demo account and practice first. Only trade when you're 100% sure all your trading conditions are met.
* Don't Babysit Your Trade - Follow your trading plan, system, and strategy. Know your entry and exit condition. Don't stress yourself out and watch your pips fluctuate or worse, go into negative red numbers. Follow your plan, set your stop losses and take profits. Walk away or do something else. Let your trading system and plan take care of the trade.
* Don't Get Greedy - Fear and Greed will get you every time. Greed is an emotion and you want to keep your cool and stay focused on practical trading. Emotional and impulse Trading is Gambling.
* Save Your Emotions - Relax and you'll trade better. Even with the best of trading plans, systems, and strategies. And in my experience, especially with Forex Robots, Signals, and Alerts. Let your profits run, cut your losses, and be sure to stick to your system and strategy. Save the emotions for when you celebrate a good week!
* Measure Profit in Pips - Focusing on pips rather than profit in dollars is far better. $'s make it emotional, pips keep it strategic. If you're not comfortable trading bigger lot sizes, don't.
* The Trend is Your Fairweather Friend - And you thought it was your friend... It will change and according to some the Forex Market is Trending only 20% of the time.
* Set Goals - Know exactly how many pips you are targeting. How many good or bad trades you're going to stop at. Everyone has bad days... I go for a walk, eat some Ritter Sport chocolate, grab a Mocha at Waves Coffee, or change my scenery in some way that gets me away from Forex. Bottom line, have a plan! ...and follow it.
* Set Conditions - When are you going to enter a trade? Exit? What is your Stop Loss and Take Profit? What are the market conditions? Market hours? Will you carry over? Trade around news times?
* Economic Calendar - The Forex Market tends to become volatile around important economic news. This "noise" can really throw off your trades. Or it can help your trading. Either way, you need to stay on top of Forex News by checking the Economic Calendar at least daily.
* Manage Your Money - Only Risk 5% at most. If you have multiple trades, the sum should be 5% or less. Some people like 3%.
* Know Your Risk / Reward - How many pips are you willing to risk? Are you going to risk 200 pips to make 20? You want to risk less than you are bound to make.
* Practice Practice Practice - Open a demo account, thoroughly test your system, plan, and strategy. Your demo account balance after 1 month of trading will give you a good indicator of how well you've done.
* Practice Practice Practice - Open a demo account, thoroughly test your system, plan, and strategy. And please don't change it every day or hour and stop looking for that holy grail. Your demo account balance after 1 month of trading will give you a good indicator of how well you've done.
* Walking Away is the most important part of your day - We've all been there, a great trading day, week, or hour. x amount of successful trades, you've met your target and you're excited. Do yourself a favour. Walk away and end on a high note. The markets are quick to turn and in our over-excitement the simplest mistake can cost you all your profits. Just walk away and continue on another day! - 23196
About the Author:
Want to find out more about Forex Day Trading, then visit Gregor Anton's site on how to Minimize Your Forex Trading Losses.
posted by X - Men @ 3:48 AM
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