There are many things that you need to take care in order to make money in the online trading world. Most of the novice traders start their trading career without knowing the market details and ultimately fails to achieve success in this industry. The professional Aussie traders always suggest the news traders learn the market basics first before they start live trading. It’s true that the initial learning stage will be extremely difficult but if you have strong determination, devotion and dedication then within a few months you will be able to place high-quality trades in the market. Most of the novice traders consider trading as easy money and ultimately blows their entire trading account. In this article, we will discuss why most novice traders find it extremely difficult to make money in the online trading world.
Lack of trading knowledge
If you want success in any sector of the world you need to know the sectors very well. When it comes to the financial industry it’s highly imperative that you learn the basic of the forex market. As a new trader, you should learn why the currency pair moves in a certain direction and what causes the volatility of the market. To be precise you need to have a very clear understanding of the basic of the forex market. Unlike the novice traders the professional traders at Saxo have a very solid knowledge in the financial industry and for this very reason, they can predict the future price movement of certain assets with an extreme level of accuracy. If you are relatively new then you should not think about making a profit in the market rather focus on learning the fundamental factors of the market.
The novice traders in the financial market consider trading as a money making the machine. Indeed its place where you can earn huge amount of money simply by placing the right trades. But you need set realistic goals in the market. If you start trading with 100 dollar trading account and expect to make 1000 dollar profit then you are most likely to lose money in trading. The professional traders always aim for 5- 10 percent return in every single month. So by this data, you can clearly understand how precisely the market works. You should always focus on high-quality trade setups in your trading platform and ignores the low probability trades. Before you execute the trades in the market think twice about your decision and if everything seems correct to place the trade in the market. Always remember that single quality trade execution is thousand times better than low-quality trades in the market.
This is one of the most common mistakes that every novice traders in the forex market make. They simply execute high lot size trade in the market and loses a huge amount of money from a single losing order. It’s true that sometimes they will make a big profit but considering the long term scenario, this is one key ingredient which makes a trader failure in this industry. Most of the professional brokers are providing high leverage trading account that doesn’t mean that you will use the leverage to take a maximum risk in the market. As a professional trader, you should always calculate the risk tolerance level and based on that you should scale your lot size and set your stop loss. Make sure that you are well comfortable to accept the loss in the market. Never trade the market with the money that you can’t afford to lose since it will make things much more complex in the financial market.
Summary: Forex trading is an art and in order to make a consistent profit you must be knowledge in this industry. Try to learn the basic of the forex market very precisely. When you execute the orders in orders in the market make sure that you are using proper money management since it is one of the key ingredients for long-term success.