6 min read
How to deal with errors in trading? Some traders learn this the hard way, losing money and making the same mistakes over and over again. Others prefer to be careful and avoid unnecessary blunders if at all possible. What kind of trader are you? If you'd rather learn from the mistakes of others, this checklist is for you. We've rounded up some of the most common mistakes newbie traders make.
1. Ignore the big picture
If you have chosen a certain asset to trade, whether it is a currency pair, a stock or a cryptocurrency, it is important to have an overview of what influences the price. of that particular asset. Of course, the use of technical indicators is very useful and can be quite precise, but traders who want to improve must learn to assess the market as a whole. What is the correlation between the price of gold and the US dollar? What assets will be affected – and how – during the presidential election in the United States? All of these questions have fairly straightforward answers, and a trader's job is to learn about economic factors.
2. Trade immediately with real funds
While the primary goal of any trader is the outcome of transactions, sometimes that means slowing down and not trading for real money, allowing time to practice first. Even when it seems like you've thought about it and have the ultimate trading strategy, trying it out on the learning account won't hurt you. It can help you find certain weak spots, correct imperfections, and actually prepare yourself to trade with real money.
3. Don't set a limit
Many novice traders go into trading without any plan. They don't know how it works or what to expect, they just want to make some money. Not only is this approach unrealistic, but it is also harmful as the trader ends up constantly getting negative results. The sequence is simple: the trader finds an asset they like and starts opening one trade after another, without collecting any useful data. When the outcome of a transaction is what he wants, he is satisfied. When the result is negative, he gets angry and invests again.
Such a vicious cycle is not uncommon, although it is not difficult to break. Setting an investment limit or sequence restriction can be a good tool for self-control.
4. Do not use indicators
Technical indicators aren't the ultimate secret to success, but they can be incredibly useful. Indicators help the trader to assess the past performance of the asset and to make certain assumptions about future movement. There is no one indicator that always gives 100% accurate signals, but they are a good help for any trading strategy. Using a combination of compatible indicators together can help increase the chances of a correct prediction.
5. Trust others for your transactions
Last, but not the least, is that many traders prefer to initiate or make a deal with someone who trades on their behalf. Not only is it completely prohibited on the IQ Option platform (here, each trader must trade on their own account only), but it can be dangerous for these recruiters. There are a lot of crooks and dishonest people out there who will trick you into sending them a down payment and you may never hear from them again.
To truly progress in trading, you have to learn and practice on your own. This is the only way to get better and waiting for someone to do it for you is pretty naive.
What mistakes have you made in the past? How did you overcome them? Let us know about your experience in the comments below.
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Source: IQOption blog (blog.iqoption.com) 2020-10-05 10:58:29
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