I wrote this article to help Forex traders who are in the wrong path. I am not saying Forex trading is bad or you should not invest in Forex market. I believe that huge number of retail traders are in the wrong path when trading currencies and it’s the reason why 90% of retail traders lose the money when investing in fx market.
Many people heard that they can get rich quick trading Forex market with little capital. So, they decide to get rich over night by trading big lots and using leverage. I have seen many beginners quit trading after 6 months of trading and some lost more than $20,000 and some tried to break even. You might ask that why these traders lost money and decided to quit Forex instead of keep going and invest in education and gain new skills and knowledge.
As we all know lack of knowledge always kills your confidence in any business and investment. Forex trader who do not have the skills and experiences to trade currencies the right way and cannot control their emotions when buying and selling currencies in different market conditions end up losing their motivation and self-confidence because they cannot believe they can do it.
If you find yourself dealing with one or more reasons why traders should quit forex market you might need to think again about trading currencies in forex market.
One of the most important part of being a successful trader is to be emotionally stable and make logical decisions in tough times. If you cannot control your emotions and keep making decision based on your fear, greed, or other emotions such as take revenge of the market or hoping that magic would reverse a trend in your favor these means that you are not ready be in the battle of bulls and bears.
For example, if you find yourself staring at your computer and cellphone for hours and do not allow yourself to catch a break or go to use the bathroom that means you are not ready and Forex trading is not for you now. You might Ask why? I personally had this issue when I first started to trade currencies. I was staring at my phone the whole time I had a position open and I did not care about the location or situation I was at. I was watching the exchange rates and pip movements the whole time even driving or sitting in a classroom. After a while, I understood I was wrong I am trading Forex to build my wealth and have freedom not to be a addicted to my phone and watching currency market all the time.
On the other hand, you might be making the amount of money that you desire, but due to your emotional instability you are stressed out all the time about market movements, data releases, and your profits and loses, I would recommend you quit Forex. I am not saying quit Forex forever, what I am saying is that your health is your valuable asset and it is important to take care of your health and learn how to control your stress because you will be paying 100 times the money you are making for medications and hospitals if you deal with health issues caused by your stress.
A LOT of people try to keep their 9-5 jobs, take care of their family, and go to bed on time and have solid traders where they can make couple 100$ a day without any analysis or trading plan. But it does not work like that if you want to stay in this market and avoid being part of 90% of retail traders who are feeding the market you need to sacrifice your time and part of your daily commitments. You cannot being to be 11 P.M. because you have to go to work at 9 A.M. if you want to be grinding In forex market. It is really important to spend time analysis market, follow news, change some of your daily habits.
So If you think you are not in the situation that you would be able to put enough time for forex market it is better for you to quit before losing all your hard earned money to the market.
Ask yourself these questions:
If the answer to any of these questions is no and you cannot turn that no to yes, I would recommend you quit Forex and invest your money and time in something else or start investing more time in learn about financial inelegance to the point you can make smart money decisions.
I saw many new traders who cannot afford the loss. These people usually trade with the money they saved for something very important for example college tuition. I had a friend who tried to double the money he got from his parents to pay for college tuition trading big size lots however, he end up losing all the money due to lack of experience, knowledge, and solid trading plan. My friend couldn’t attend his college one semester because he couldn’t afford to lose the money he wanted to invest in Forex market.
If you are in a situation that you are not able to take a losses you need to quit forex before it gets to late.
The key is to trade Forex with the money you have saved for investing which I recommend you consider that money gone as soon as you deposit that money in your Forex account because it helps you reduce your stress and stop making decisions based on fear and other negative emotions. Based on the example I mentioned above my friend Matt could save the money he was spending on video games and other luxuries and invest that money in long-term Forex position, create a trading plan, and constantly learn about the market without worrying or panicking about the short time-frame he had at the moment or the money he needed for his college tuition.