We are glad to list below a second article concerning some reasons why your trading may not be profitable!
Strategies changed too often
The process of learning the Forex market is full of technical aspect. After a trial period with a demo account, all traders feel the need to start making profits finding often problems related to their strategies. Trading strategies are unique: 2 traders using the same strategies will never reach the same results. This is due to a personal interpretation of charts that is definitely different between the two individuals.
Our advice is to don’t change very often your trading strategy!
We have listed few reasons :
- You must carefully analyse and examine the strategies that best fit the time frame in which you want to negotiate. Always choose the strategy depending on your point of view, choose the most profitable and test it several times in a very critical through on your demo account.
- It ‘s best not to change strategies more frequently than once every six months.
- Search the various parts that make your strategies valid and control how these interact with each other in order to create a situation of profit for your trading. You have to know your strategy under all his aspects to earn as much as you can from it.
- A good trader is always being updated, so it is constantly learning. It’s good to keep in mind that not everything that you learn will be relevant to your trading strategy. So you have to understand if one of the new concepts learned can fit your strategy, otherwise it is better not to edit it.
Unexpected financial news
Every trader will run into a situation where, after getting a perfect set up of trade and stop loss, the position is going in the opposite direction. It must be said that each trade is only potentially beneficial for the trader. There are always some factors that could suddenly ruin our trade.Many of these reasons are related to natural reactions to unexpected financial news.
All the operators will be affected in some way to these financial news for several reasons.
For example, scalpers are interested to use the volatility of the trade.
You always need to make sure that :
- You have an economic calendar that provides an indicator of volatility for important events. In fact it should be part of your material analysis especially if you use long-term trade. All the current events are rarely predictable, so it is best not to make any long-term trade and wait for market reactions. Scalpers may decide to take advantage of high volatility events.
- Even news not related to the financial sector can cause drastic changes in prices and so make sure to use a Stop Loss order to minimize the potential loss.
- Not all events are represented in economic calendars properly. The main events that need to be controlled are the one related to large companies or worldwide leaders. Sometimes also changes to a particular policy may change prices. These events are labelled as low-volatility but we advice to treat them as high- volatility events.