Simple Solution For Beginner Forex Traders
There are many mindsets or mindsets that are too simple for beginner traders and most of them lead novice traders to failure. Yes, many beginner traders who want a short way to succeed in the forex business. Though forex business is a risky business especially for beginner traders and / or traders who use high margin and leverage.
As a retail trader, the use of margin and leverage is sometimes inevitable. Limited capital with the goal of achieving optimal profit is the hallmark of a retail trader. Well, this article will provide a simple solution for beginner traders, namely by changing the mindset mentioned in this article.
First, the 50-50 chance assumption. Yes, in forex trading, many think like this: the price moves if it does not go up yes, trading position if not buy yes sell, loss and profit opportunity 50-50. This mindset should be avoided because the business is not just a game. You have to think or do something to make the opportunity work for you. For example, prices do move up or down but you should be able to identify the extent to which prices will rise or fall and also find a level position that provides a loss and profit opportunity of 30-70. Or by placing a stop level to limit losses.
Secondly, you only know the graph as a determinant of trading decisions. Yes, many say trading using technical analysis will be simpler than combined with fundamental analysis. This is not to blame, but many traders try to analyze the economic data (fundamental) after they lose due to their technical decisions. The solution to this mindset is you need to know and understand how and why the price can move? Who drives the price? Because the price graph is a reflection of market behavior that contains various types of market participants with many different motives.
Third, forex trading can quickly make money. Indeed yes, but you must know the risks that you will face when entering the forex market. You can lose all your funds or capital if you do not understand the true risks of this forex. The solution is you have to be patient with the price movement in the market. We are merely retail traders who provide very little contribution to market price movements. Hope generate a profit of Rp 1 Million per day only with capital Rp 5 Million could turn into risk of loss of funds entirely.
Of the three described above, a simple solution for the novice trader lies in understanding his risk management and money management. Whatever trading system you use.