Making mistakes at the initial stage is very normal. But this should have any impact on you since you will be trading with demo accounts. Demo accounts are nothing but trading the real price feed with the virtual dollar. If you lose money, you don’t have to worry about it. Even if you blow your trading account, you can easily open another demo accounts to develop your skills. During your development stage, there are tons of challenge you will have to overcome. Without having the strong willpower to become a profitable trader, it will be nearly impossible for you to change your life. Being a human being it’s very normal for us to make mistake. But this doesn’t mean we will commit the same mistake repeatedly. A good trader always learns from their mistake and fine tune their trading strategy to improve their performance. Let’s learn about the four deadly mistakes of novice traders.
Overtrading the market
We all know overtrading is one of the biggest mistakes any trade can make in their life. But if you do some extensive research, you will be surprised to know, and overtrading is one of the major ingredients which triggers other minor problems in your career. You don’t have to trade all day long to earn huge amount of money. Just by focusing on the core factors of the market, you can easily lead your decent life. Always remember, trading is nothing but your business. You need to have a strategic approach to this profession or else leading your dream life will become very hard.
Trading the lower time frame
Lower time frame trading is extremely popular among the novice Aussie traders. They think scalping is the only way to earn huge amount of money. But things have changed a lot over the past years. fx trading Australia is now way more popular as reputed brokers like Rakuten is offering their premium service to their retail clients. A few good trades in a month is enough to ensure your profit factors. However, there some expert traders who often trade the lower time frame. The expert scalpers in this industry have years of trading experience and they know the proper way to filter out the best trades even in the lower time frame. Unless you have more than two years of trading experience, you should never try to scalp the market.
Trading against the market trend
Trend trading strategy is extremely risky. People don’t realize the fact the market always favors the long-term trend. So, if you want to trade against the market trend, there is a high chance, you will not become a successful trader. As a retail trader, it’s your duty to find the market trend. But you can’t ever find the strength of the market trend by relying on the technical data. You should also use the fundamental analysis to assess the economic performance of a certain country. Belding your technical and fundamental data is the only way to secure the best trade.
Using high leverage trading account
Things have changed over the past years and all the brokers will offer you high leverage trading account. But you need to ask one simple question to yourself? Do you know the proper way to trade with a high leverage account? If the answer is yes, you are most welcome to place big trades with managed risk. However, it’s highly unlikely new traders to have complete control over their emotions. After losing a few trades, they start using the market leverage in a very wrong way. At times their aggressive trade execution will help them to recover the loss. In the long run, such an aggressive strategy will never work. You are here to make money in a systematic approach. You should confine your emotions and trade with logic.