3 Common Mistakes Forex Traders Often Do (& How To Avoid It)

February 3, 2021 - 4 minutes read

3 Common Mistakes Forex Traders Often Do (& How To Avoid It)

Mistakes happen. It’s human nature to experience it, to burden it and learn from it to not repeat it again. With forex, you can never escape the flaws you intend or unintentionally do to gain profit from the currency trade. Even the best forex traders in Malaysia could never make a getaway from the errors they do throughout their endeavours with the trade.

Forex, a portmanteau of foreign currency and exchange, is the buying and selling of one’s currency to another currency. A simpler word for it is trading against each other’s currency, making the market the largest and crucial industry in the global economy. Opens for 5 days each week, the forex industry is highly liquid and stable for any traders and investors alike on trades.

Here are 3 common mistakes forex traders often do and how to avoid it to learn where you should be buying and where you should be selling:

Trading Strategy Is Absent

Many aspiring traders who participate into the forex market for the first time may seem to be too excited to get their hands on the trading at their forex platform Malaysia, however what they do not know is that they are putting the odds against them. Most of them do not see the forex market in the bigger picture and are often fixated on a certain time frame, be it within an hour, four hours or weekly.

Every forex trader needs a trading strategy beforehand so as to not make their lives all the more difficult. To fix this, take a look at the higher time frame to give the higher probability trade setups while at the same time, lower the losses for the profit gain to increase.

Lack Of Research

If lacking research is the foundation of trading failures, how do traders even begin to grow the roots of their trading tree? The world of interexchange currency is built on interconnected dynamics. Therefore, the forex spread is not the only thing traders should be focusing on. They should also be alert of political and economical changes whether it will benefit or put the risk upon them.

Learning the fundamentals of the market and money management are also important to kick start the trading journey in forex Malaysia.

Too Quick On The Profits And Lose The Grasp For Larger Gains

The key principle of forex trade is very straightforward; to minimise losses and maximise profits. However, some traders take too light of this amidst holding a position for too long and wane returns by taking the profits too early. Although they will receive the money in any way, consistent action of this can sap their earning potential. Avoid fear and greed to take control and be rational at evaluating technical and indicators. Perform a clear, holistic trading plan and stick to it.

Patience is a virtue, and you will be rewarded with a worthier price.

Trading may look simple, but it is not that easy.