The dismal statistics of Forex Trading show that the majority of people lose money and a lot of it on currency trading. Why is that? Why do most of the people end up short? There are a number of common reasons.
1. People don't understand the market - Most people operate under the assumption that forex trading is easy. After all, it's just one currency versus another, isn't it? Sounds very simple, but it's not. The Forex Market is one of the hardest, fastest, and most volatile markets in the world. You need to invest some time and money in learning how this market operates. Start by getting a good Forex trading book.
2. Operating on the tips of friends and strangers - People are always on the lookout for tips on the direction the forex market is taking. And you know the terrible thing: People operate on the tips of not only their friends, but also complete strangers, all of which haven't got a clue as to how the market really works. Operating on tips isn't trading. It's gambling.
3. Paying too much fees - People don't shop around for the cheapest trading platforms and brokers and end up paying huge commissions on every signal and action. Shop around and negotiate every fee. Don't be a sucker and waste money on commissions.
4. Succumbing to emotions - People buy when it's high and sell when it's low, this is the rule of the market. The reason is that people panic when they see their investment going in the wrong way. They end up making bad decisions which minimize their profits and maximize their losses. Try to detach yourself from your emotions and let your logic make your decisions for you.
5. Working without a Forex Trading Software - Forex Trading is a global business which operates 24 hours a day throughout the year in multiple markets. It's virtually impossible to operate in this market without a special Forex trading software. All the serious traders have such softwares. In order to enhance your chances of making a lot of money, get one for yourself.
If you're making any of these 5 mistakes, stop right now and start taking the right steps to make a killing on the Forex trading market.
