If you've ever traded before or you’re actively dealing in online financial markets now, chances are you've taken some hits to your capital because of bad trading habits.
One of the most disheartening stats I've stumbled upon in my 20 years of trading experience is that nearly 95% of traders end up losing money in forex trading.
Every time I see that number, I wanna ask how they came up with it. But it’s so widespread that it’s tough to trace back to who first said it.
The reality, though, is that practically every trader out there has lost, is currently losing, or will lose money trading in the financial markets, no matter if they're chasing forex, crypto, commodities, stocks, or bonds.
I'm going to highlight a different group of traders those who manage to recover from their losing streaks and actually become profitable.
So, let’s kick things off by checking out some trading mistakes that are totally avoidable, and that many people are still making.
Mistake #4 - When You Trade Without Managing Risks Properly
You would definitely go broke if you wont really be having this kind of consideration on which we do know that risks management is really that important because this will really be that pertaining
about on how you would really be that handling out that risks management on which this is really that important since this will be that needing up the money on how you would really be able to
make out division on how you will be that managing those funds on the way that you would really be dealing up with this volatile space. Solutions will really be that basing up on how you do handle
up. Its not easy but it isnt that impossible on which problems does have its own solutions on which its really just that normal that you will really acting out accordingly.
There are tons of factors on which it would really be affecting out your overall profitability on which you will really that important that you do really need out to make adjustments accordingly.
You cant really just that easily be able to grasps out everything but you would really be able to gradually be able learn up things accordingly but it would takes up time.
Some mistakes are part of our human error, while some are generic because we are, more likely not to know about them before they happen. as traders, we have to include this as part of our preventive measures, that we are going to make loss and risk trading, only that we must also ensure that we often go profitable than being in loss whenever we attempted to trade.
There are so many people make so many similar mistakes and it's true that we are looking at this like it's something that would be easy to fix, but unfortunately they are not, and we are looking at this as something that would not be easy to handle at all. We should realize that it is not going to be easy and while that is true, we should not be really looking into this as something that would be simple neither, we should realize things will be very different if we know what we are doing.
So yes, these mistakes are common, but there is a reason why they are common, and yes people should avoid them, but many won't, specially the newbies who have not made these mistakes yet, they will do them first and learn not to do them later on.
There are too many conflicting points in your post but I just picked out these two to dispute them with the hope that we can learn from the discussion. These are not mistakes in trading, they are exactly what makes trading what it is and doing them is practicing the exact skill we call trading. A trader predicts the market using different techniques and tools and then apply timing to ensure he enters the market at the right session to avoid facing market manipulations. If you don't try to predict the market, then I wonder what you will be doing as a trader because everything a trader does is speculation.
Most new traders do not really blow up because they were wrong about direction. They blow up because they were wrong about size. Being wrong is normal. Being wrong with 20x leverage and your ego strapped to the order button is how the market turns you into forum compost.
The "predicting the market" part is the big trap. People want prophecy, but trading is mostly probability and execution, also survival. A good trader is not someone who knows what happens next. A good trader is someone who already knows what he will do if he is wrong, if he is right, and if the market does that annoying third thing where it wiggles sideways until your patience leaks out of your ears.
I half agree on support and resistance. They are not magic lines drawn by candle wizards, but they are not useless either. They often show where liquidity, stops, and crowd memory are sitting. The mistake is treating them like walls instead of zones where ugly things can happen. Same with indicators. RSI, MACD, moving averages, whatever flavor of chart soup someone enjoys, they are tools. The stupidity starts when people outsource their brain to them.
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The best advice in that whole post is risk management, but it is also the part nobody wants to hear because it is boring. "Risk 1% and journal your trades" does not get clicks like "turn $500 into $50k before breakfast." Yet the boring stuff is what keeps you alive long enough to learn. If someone cannot tell you their invalidation before entering, they are not trading, they are just buying a lottery ticket with extra buttons.
Also, the expert advice thing is dangerous. There are good traders who share useful ideas, but copying calls is usually financial taxidermy. You end up wearing someone else's trade after it is already dead. If you take ideas from others, fine, but rebuild the reasoning yourself. If the setup only makes sense because a Telegram admin posted rocket emojis, close the tab and go drink water.
In the end, most traders need fewer indicators, less leverage, more sleep, and a written plan they actually obey when the candles start biting.
The market does not care if you are smart. It cares if you are liquid. 🦴
Just make it sure when you try to predict markets that any outcome that comes is acceptable to you. Because many traders go broke in what they believe is right even if they're wrong. The strategies are there and there's plenty of it but, not all of it will work and as long as these mistakes that you have encountered in the past trades will be avoided and you learned from it. That's the best way to avoid and not go broke with trading. Otherwise, if you don't like to trade anymore then be an investor which is a better choice.
Generic can sound common though. But as a human, we are sometimes very confident or idiotic, so so even the common mistake can still occur on us. And that is why they are common anyway, because humans keeps on doing them . Saying that you are going to lose your money in trading sounds negative already and can actually discourage someone. Although no doubt that it can make someone very immune to losses if in case they still choose to continue. The proper saying will still go like this: In trading, there is also a chance to lose money apart from earning a profit.
BTW mate, your last part, contradicts to what you said earlier about accepting a defeat in advance. But what you said earlier fits better more in gambling than in trading because we still can get entertained there, despite we kept losing money. In trading, it is still true though that we must ensure that we are up if we are not a newbie on it anymore, only to make things more senseful about it.
It's not a mistake, but "how" you do it could be a mistake. When you predict or time, you could be wrong, and there are a lot of newbies who mistime or fail to predict the market.
Sure we need to predict and time the market perfectly, and if we do a good job then that is good, but if we do a bad job then it is a mistake. That is what I assume OP is talking about, and we need to be careful about it and if we are careful about it then we can do a very good job of it at the same time.
Trying to predict markets is literally what traders do. It's irrelevant if that's possible to do or not, because educated guess is the only way to decide anything when you enter or exit.
And not everyone can be a freaking Soros. Markets aren't designed in a way that everyone could win by trading. Or even investing.
Good luck finding that edge against paid researchers and machines that can react in nanoseconds to markets.
Rest of the advices are solid, expect maybe the part where you call Humans as "rational beings". That's not really true. There's no rationality behind most of our acts, even with the ones we "feel" to be rational. Even our most rational thoughts are sparked and filtered trough emotions, because emotions are deeply woven into our thinking process.
None of us are perfect and make mistakes some or other times. It is important if we learn from those mistakes. If we do not learn from those mistakes than we can never actually learn anything from life. Mistakes are our best guru and if we do not learn from those mistakes than there is nothing greater than can ever teach us. It is okay to make mistakes at the start but rectifying those mistakes and making sure we won't do it again is what is most important. Humans are going to make mistakes because they can only learn from mistakes and let's not forget that.
Predicting and timing the market might seem quite easy as stated by OP as well but in real, it is a challenge. It is not really that easy to predict the markets and we can only become an expert if we keep practicing while making mistakes.
No market prediction or speculation is ever accurate or perfect. Therefore, don't go all-in on anything 100% without properly managing your assets. Even the best analysis can cause market fluctuations due to certain sentiments. It's best to always have a backup strategy to spot market changes early.
I remember how many people, especially newbies, immediately go all-in on crypto investing or trading. It's not just because they don't understand the concept, but because they're so FOMO, greedy, uneducated, and just following the hype. So, let alone managing the risks to minimize the impact, they may even lack a grasp on market conditions and the meaning and benefits of managing the risks.
Another crucial factor that often causes someone to lose in trading and investing very easily. This occurs not only to newbies but also to anyone who hasn't yet learned to manage and control their emotions wisely and calmly.
There are those that by a simple look, you know they are truly difficult but some are like that you said there, only look easy but not anymore by the time we are now experiencing the real thing. So it is always better to not talk early and brag, especially if there is no real action that is taken yet.
The reason why some of these are so common, is because they may not really be avoidable, or it is only easy to mistaken them as easy. If we are a newbie, we still can do our best to not fall for them. We have a community like Bitcointalk for example, that we can read for information, or tips and tricks on how to navigate safely in our trading crypto journey.
I agree, in trading mindset is really important you cant expect everyday prediction to be right, so you should be okay with different outcomes. A lot of traders lose money not because they have no strategy but because they dont manage risk or they refuse to accept losses. Learning from mistakes is the key actually, if trading feels too stressful, switching to long term investing can be a better and calmer option.
There are a lot of crypto communities nowadays that a newbie can benefit from joining.
Only if they are so serious and have always been asking the right questions that shall benefit them.
But because this is crypto, they think that everything is so fast even their way of earning some good trades. They also need to adjust and make realistic plans.
I think when youre trading you should be ready for whatever outcomes that happens, because as a trader there are tendency and room for errors, most of this errors might be something you didnt plan for while some are also something that you planned for so you will never know what is happening with your trading, its normal to loose sometimes and sometimes you will also make it, so human error is something that I think is normal, and we should also accept our loose because experience is the best teacher and you just have to know that you loose sometimes and you win sometimes.
I took a while for me to ready the entire post but I have to say, you have quoted the solutions up to point. Even though your post might have merit, why would new traders still trust you? You as well are a new trader to them considering the forum rank. I would like to know if you have had a successful career in trading or are you into mentoring and teaching others? If you are just into mentoring than maybe you should try to start a community and try to teach then first. See if they are successful and only then think about maximizing your risk.
If you are a trader and do not want to go for mentoring than you already are on a good track and should be able to make profits if you stick to your solutions. Try not to get carried away and most importantly, be patient.