There's an old adage, "You're making money when you're saving it." It's so true for traders. The market is flooded with a lot of information, and we need to sift through the ones that can really fight the market. Whether the market crashes next or continues to boom, the wealth of information in the market is always dazzling.
So, what are the time-tested trading techniques that can prevent losses? Before looking for the answer, first of all, we need to understand what caused the loss. Only by finding the reason can we better change the result. After various comparisons and investigations, it is found that the most likely causes of traders' losses are the following five reasons:
lack of experience
One thing all traders agree on is that trading takes a lot of learning. After trying out a demo account for a few weeks, most traders are eager to try real trading, resulting in serious losses in their accounts and shattering their confidence. Many trading systems claim to be the "golden system", but in fact, just as traders give up trading easily, these systems can easily knock you out.
irrational expectations
Don't give up your official job! Trading is not a get-rich-quick scheme, and if it were, everyone would be trading. You must know that traders need a certain amount of capital to gain a foothold in the market, and it also takes a long time to acquire important trading knowledge. Before you hand in your resignation letter and move from a demo account to real trading, take a step back and figure out how long it will take you to survive the market while maintaining your current lifestyle.
Lack of a good trading plan
What is your goal? Where are your stops and targets? Do you have an exit strategy? What day and time of the week do you think you perform best? These are just some of the questions, but if you don't know the answers to these few questions, then I think the best place for you to go is Las Vegas...it will be much more interesting.
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