: New trader? Experienced trader? Somewhere in the middle? Regardless of how long youve been trading, its very likely that youve struggled with identifying trends in the markets. Trends are crucial to successful trading, but theyre also one of the biggest problems for traders. So, how do you avoid wasting time and energy when it comes to predicting trends? The answer is simplicity itself.
Trading the Wrong Market
Traders who play favorites in this area are setting themselves up for catastrophe. Its easy to get comfortable in one market, but its easy to get comfortable in one pair of socks, too. The bottom line is the same: you need to diversify. Thankfully, its not hard to do theres just one thing you need to look for.
Lack of a Trading Strategy
In this industry, most people call themselves traders. Unfortunately, a better word for a lot of them would be gamblers. No matter how you spin it, trading without a strategy is equivalent to a stint at the craps tables. But theres no reason to resort to that finding a dependable trading strategy and sticking to it is really very simple.
Not Limiting Your Losses
Hate to lose? Who doesnt? But theres a difference between losing and losing BIG. Lots of traders fail to limit their losses in search of that one, big win. They feel like any loss is a failure, and so they dont incorporate a strategy for losses at all. Thats the first mistake. Luckily, its easily avoided.
Not Taking Profits
Its an emotion every trader is familiar with: greed. Who doesnt want to get rich, and who doesnt want to do it in one trade? But thinking that way is one of the main reasons most traders lose money. Theres a much better method to making your fortune.