Making mistakes in the retail trading profession is a very thing. Everyone makes mistakes as a trader. But smart people learn to mitigate the risk factor even after making silly mistakes in their careers. To become good at the CFD trading profession, you need to know about few common mistakes which have been ruining the career of a new trader. Though there are many causes for which people are losing money we are going to discuss the top five mistakes committed by the rookie trades.
While reading this article, make sure you get things in your mind. Unless you mentally prepare yourself and learn about the losing trades, you will keep on struggling in the trading profession. So, without any delay let’s get into the details.
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Trading against the trend
The rookies love to trade against the trend. To them, a reversal trading strategy offers the best way to earn more money. Some of the rookie traders even think that they can only make a profit by trading the tops and bottoms. But such mentality is one of the price reasons for which we have such a low success rate in the trading profession. As new traders, we must find a way to ride the major trend with strong confidence. For that, we have to develop a professional trend trading strategy. Only then we can reduce our stress in the trading profession.
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Using the leveraged account
Leverage trading accounts are provided by the retail brokers so that traders can earn a big amount of money by investing a small capital. But do you know that leverage is another key reason for which keeps on failing? The professional broker never encourages the rookie traders to trade with insane leverage. Click for more info and learn about the leveraged account provided by the high-end broker Saxo. You will be surprised to see that they are not offering insane leverage. They offer optimized leverage trading account as they know the use of high leverage trading account can cause a great problem for retail traders.
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Using the signal service provider
As a new trader, you should never use the signal service provider. Though some of the signal service providers are very good at providing high-quality trade signals they charge heavy fees. And to cover up such fees, you have to invest a big sum of money. Instead of trying to get the signals from the professional trader, you should learn to find your signals. Study the technical analysis process and curate a simple trading system. Once you become good at that, you should be able to make significant progress in your life.
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Trading too often
You should not become addicted to this market. The new traders often become addicted to the trading profession and they think that they can make big money without doing the proper data analysis. But if you want to succeed as a trader, you should limit your trade execution process. Forget about the aggressive approach and try to develop a simple trading system that will help you to find the best trade signals. Taking one or two trades per week is enough to make living out of trading. But make sure you invest a decent capital or else such few trades are not going to be enough. Thus you will never get rid of this problem.
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Revenge trading
As a trader, you have to learn the proper way to accept the losing trades. Without learning to deal with the losing trades, you will end up with the revenge trading problem. Revenge trading is one of the key reason for which people blow up their trading account. To keep your fund safe, you should be focusing on the simple trading approach. Accept the losses and wait for the next trade signals. Stop trying to recover the losses by taking random trades even though the market is no willing to offer any profitable trade setups.
