Monday, March 10, 2008

Day Trading Mistakes - Avoid These 7 Fatal Deadly Sins!

Forex trading is not really an easy and novice-friendly investment opportunity. You are bound to stumble along the way, and commit some day trading mistakes in the beginning. This is normal. It's how things go. You learn from your mistakes.

At some point, you will have enough knowledge and experience to succeed in forex day trading, but beware... some mistakes can be very costly and you can lose all your hard earned money.

What you need to do to avoid this situation?

The best thing you can do to avoid this is investing in your forex education. Why not learning from others mistakes?

Experienced traders spent years developing systems and proven methods, and all this knowledge is waiting for you on the Internet.

Just read and watch some forex videos (on youtube for example) before you start.

Another thing you should do is never trade in a real account... Unless you are profitable with your demo account several months in a raw.

In fact, you could even stay one year trading with your demo account before starting for real. Don't be afraid to practice with fake money. If you lose, it's not a big deal...

Many beginners in forex will do on of these 7 fatal day trading mistakes:

1. Impulsive decisions

2. Ignoring forex news

3. Not understanding the charts

4. Not using stop loss

5. They don't invest in proper material

6. No mentor (or mastermind group) in the beginning

7. Not understanding compounding

Remember, to minimize the effects of the consequences of these mistakes you might inadvertently commit, observe compounding as your game plan.

When reinvest your profits (that's what smart traders do), you'll considerably reduce your risk because even if you lose money, your initial investment will be safe.

I really hope you won't fall in any of these day trading mistakes.