20 Rules To Stop Losing Money in Forex Market!

Monday, November 19, 2007
20 Rules To Stop Losing Money in Forex Market!

1. Dont blindly trust others opinions - It's your money at stake, not theirs.Use your brains too. Do your own analysis and make decisions.

2. Don't believe in Any company - Trading is not like investment. Just concentrateon the numbers and forget the press releases.

3. Don't break your own rules - You made them up for tough situations, just like the one you are probably in right now!

4. Never try to get even - Trading is never a game of catch-up. Every position will and must stand on its merits. Take your losses with patience and analytically, and take the next trade with unhindered discipline.

5. Don't trade over your head - If your last name isn't Buffett or Cramer, don't try tp trade like them. Concentrate on playing the game with good tactics, and don't worry about making or losing money.

6. Don't seek the Holy Grail! - There is no secret trading formula that will fetch you unlimited profits, other than good risk management. So stop searching for it.

7. Don't forget your discipline - Learning the basics is pity easy. Most newbie traders will fail in due course as a result of lack of discipline, not a lack of knowledge.

8. Don't try tochase the crowd - Listen to the beat of your heart . By the time the crowd acts, you might be too late…..or too early.

9. Don't trade the obvious pattern - The prettiest patterns can set you up the most painful losses. "If it looks too good to be true, it probably is".

10. Don't ignore the warning signs at any trustable sources -Major losses rarely come without any warning. Do keep a look out for warnings!

11. Don't count your chickens - Profits aren't booked until the trade is closed. The forex market gives and the market takes away with great fury with out a damn for any one.

12. Don't forget your plan - Always Remember the reasons why you took the trade in the first place, and don't get blinded unnecessarily by volatility.

13. Don't have a shrewd paycheck mentality - The market only pays off big time when you're right, and your timing is really, really ON TIME ;).

14. Don't join groups - Trading is not a team sport requiring unity . Avoid stock boards, chatrooms and financial news on TV. You dont wanna repent later and will end up cursing the group!

15. Don't ignore your intuition - Respect the little voice that tells you what to do, and what to avoid. That could be the voice of the winner trying to get into your thick head.

16. Don't hate losing in the market- Expect to win and lose with great regularity. Expect the losing to teach you more about winning, than the winning itself. Thats FX market for you.

17. Don't fall into the complexity hole - A well-trained eye is much more effective than a stack of automated indicators. Common sense is more valuable than a backtested system. AS they say common sense is very uncommon.

18. Don't confuse execution with opportunity - Overpriced software which promise you results won't help you trade like a pro. Pretty colors and flashing lights make you a faster trader, not a better one.

19. Don't project your personal life in trading forex- Trading gives you the perfect opportunity to discover sometimes just how screwed up your life really is.

20. Don't think its entertainment - Trading should be boring most of the time, just like the real job you have right now. But never look for entertainment in there. You wont get it!

You might like to read other Forex related articles in the Articles section or browse through our huge collection of forex ebooks!