Learning something new from scratch is a very challenging task. Most of the new traders in Hong Kong struggles hard to protect their initial investment. Being a new trader, it’s very normal to lose trades on a regular basis since you will not understand the complex price movements of the financial instrument. But this doesn’t mean you will always have to lose money to learn to trade. Find a reliable broker like Saxo and open a demo account to master the art of trading. Unless you can make consistent profit for three consecutive months, you should never start to trade the market with real money.
There are many things you need to consider to become a successful trader. Today we are going to highlight 5 big mistakes committed by position traders. These are –
- Not having enough knowledge
- Trading with false confidence
- Trading with a low-end broker
- Trading the market reversal
- Trading with tight stops
Not having enough knowledge
Knowledge is power when it comes to position trading strategy. Never expect to earn huge amount of money without having a clear idea about this market. As a currency trader, you need to work hard to master the three major sections of market analysis. The rookie traders often traders the market based on technical data but without analyzing the fundamental variables you will never be able to assess the strength of the market trend. So, educate yourself properly to become a successful trader.
Trading with false confidence
Confidence is necessary but trading the market with false confidence is nothing but a suicide mission. Many retail traders don’t even know the proper way to find the market trend. They simply rely on the indicators reading and execute big trades with zero risk exposure. Such an aggressive approach usually results in heavy loss. So, how do we develop strong confidence? The answer relies on the first point, “Proper education”. Train yourself so that you can find good trades with proper logic.
Trading with the low-end broker
You will never find a successful trader, using a low-end broker. Those who are to the trading profession feel free to visit https://www.home.saxo/en-hk to learn more about the professional brokerage firm. A premium broker will always help you to find the very best trades. In fact, they will offer you a robust trading platform for quality market analysis. Some of the high-end brokers might have a high initial deposit requirement, but still, it’s nothing compared to their offered service. So, choose your broker carefully or else you will lose money most of the time.
Trading with the market reversal
Being a position trader you must follow the long term market trend. Never try to trade the tops and bottoms of any currency pairs. Making money in the retail trading industry is a very challenging task. You must learn the proper way to ride the market trend. Use the Fibonacci retracement tools to find the exact entry point of a trade. No matter how good a reversal signal is, stick with a simple trend trading strategy.
Trading with tight stop loss
The majority of the new position traders prefer to trade the market with a very tight stop. They simply think this is the best way to limit risk exposure. But you need to give your trade enough space, or else the market will hunt the stop loss. Instead of using a random number or fixed stop loss for each trade, learn price action trading so that you can place a trade with managed risk. Use the simple Japanese candlestick pattern so that you can easily execute high-quality trades at any market condition. If you lose some money on any trade never become frustrated. Wait for the next possible trade setups. Stop revenge trading the market as it forces you to take unnecessary risks.