Making mistakes is very common in the trading profession. You might have extensive skills in the market, still, you might make silly mistakes due to negligence. For every mistake, you have to pay dearly. Professional traders know this very well and therefore carefully avoid making deadly mistakes in the trading profession. If you want to become good at trading, you need to be extremely cautious about your trade execution process.
In this post, we will be highlighting some of the deadly mistakes you can commit as a novice trader. Make sure you never make these mistakes in the trading business. If you do, you are going to lose most of your capital.
Developing the habit of overtrading
Overtrading is a very serious problem prevailing among novice traders. Novice traders always try their best to earn more money. They keep monitoring the chart all day long and eventually execute too many trades. To ensure the safety of your trading capital, you must limit your trade execution process using some rules. Try to trade the market with a strategic routine so that you don’t feel stressed. Follow the safe approach and focus on the longer-term trading method.
Trading against the trend
The majority of rookie traders don’t even realize that they are trading against the trend. Since they trade in the lower time frame, they end up taking the trades in favor of the retracement phase. Visit home.saxo and learn more about the different phases of the market trend, so that you can manage your trades in a much better way. Once you learn about the different phases of the market trend, you should be able to scale your trades in a structured way. Thus, you will be making fewer mistakes in this industry.
Trading with the high leverage account
You should never trade the market with a high leverage trading account. If you trade the market with the high leverage account, chances are very high that you will never learn to execute quality trades with a high level of precision. Most of the time, you will be taking the trades with great risk and thus you will put your career in the line of fire. Try to choose your account leverage in a strategic way so that you don’t have extreme buying power. You might say that you can control your emotions and the leverage is not going to affect your performance. Sadly, you will lose control and become emotional after losing a few trades in a row and thus trade with extreme risk.
Trading the minute time frame
Being a new trader, you should never trade the market in a minute time frame. If you want to make a decent profit in the retail trading business, you need to follow a safe approach and focus on the higher time frame data. Trading the higher time frame is one of the key reasons for which people are making consistent profits in the retail trading industry. Develop a higher time frame trading strategy from the beginning of your trading career and trade the market with an extreme level of confidence.
Trading with too many tools
You should use a simple trading system to make consistent profits in the market. If you rely on a complex trading tool, the chances are very high that you will never learn to execute the trades at the right time. For the safety of your trading capital, you should follow a safe approach and take your trades with the most essential tools. A complex trading system has nothing to do with your profit factor. If you rely on the complex system, you will become frustrated with your actions. Try to trade the market with the simple price action trading method and trade with very low-risk exposure. Never increase your risk profile in the trading business as it will ruin your career.