To be successful in future trading requires one to avoid several mistakes people make and finding a great way to execute winning trades. In a matter of facts, successful traders will tell you that there is no successful or method of becoming a successful trader; but rather, they will give you an overall view of techniques they used to keep them long enough in trading to be successful.
Well, below are the 10 mistakes traders, which affects future trading. The list has not been ranked in order of importance.
1. Planning Before Executing Trading
A trader with no specific plan of trading action into future trading does not know some of the things to watch out for or where to begin. As a result, they are most likely going to lose everything including their capital. A trader with no pre-determined trading plan is like a pilot with no destination or flying path, which they are all recipes for disaster.
2. Improper Money Management And Inadequate Trading Assets
It is a known fact that it does not take fortunes in futures trading. Traders with less than $5,000 in their trading account can be successful. At the same time, traders with more than $50,000 can lose it all in a heartbeat. For this reason, it is good to say that successful future trading lies to proper money management and not to the amount of capital a person has.
3. Psychological Expectation
It has been reported that people who are beginning in future trading do quite their jobs and try making a living trading futures. Well, this is one of the biggest mistakes these people do. The truth of the matter is that, the first few months of trading are usually disappointing. This is because this people tend to do a lot of mistakes in trading due to psychological expectations (like wishing to be rich in one trade) and desperation.
Well, to be successful in trading, you have to take it like any other profession (being a doctor, lawyer, businessman and others). There is no way you can be a successful businessman or doctor with just a few months training and practicing. It takes hard work, patience to achieve what you want.
4. Failure To use Protective Stops
Protective buy or selling stops are there to protect the trader from incurring losses. Therefore, a trader with a good idea of the amount of money they are risking on a particular trade should it turn into a loss; will definitely consider using protective stops. They will not only help you prevent incurring losses, but also they are a good money management tool; however, not perfect. It is important to know that there are no perfect money management tools in future trading.
5. Lack Of Trading Discipline And Patience
When it comes to trading, there are two virtues that a person should not lack. These virtues are discipline and patience. There are many articles, books, and reports that talk about this but many people tend to ignore them. As such, it is important to know that there is no way you are going to be a successful trader without these two virtues. This is because at times you will need to be patient and disciplined in trading.
6. Trading Against The Trends
It is human nature to sell high and then buy low. However, this is not always the case or the only proven way of making profits in future trading. Both bottom and top pickers who are usually trading against the trend are making a big mistake.
7. Allowing Losing Positions to Run For A long Time
A majority of traders do lose because they let losing positions to run for a long time. If today you get an opportunity to ask successful traders how they do it, one of the things you will hear is that they do not let losing positions to run long at all. They generally cut their losses and then close the trade and move to the next. To traders who let the trade sit for a very long time, hopping that the market will soon turn around in their favour are usually doomed from the start.
8. Over Trading
Trading too many markets at the same time is a very big mistake; especially if you are ranking up losses. If you do this, it is advisable to stop doing this especially if you have noticed that you are incurring a lot of losses. It is advisable to trade on one trading platform at a go.
9. Lack Of Accepting Responsibility For Your Own Actions
Another big mistake traders do; is failing to complete responsibility for their actions. These people tend to blame their brokers or someone else. Keep in mind that you are the one who is responsible for your own actions, even when it comes to trading. If at any time you feel that you are not in control of your trading; then ask yourself why you are feeling that way? After that, you should do everything in your power to keep you in control of your trading.
10. Inability To get A Bigger Picture On Marketing
The truth of the matter is that anyone can take a look at daily bar charts, but not everyone is going to get the bigger picture the chart is all about. For this reason, it is advisable to take your time to look at the weekly and monthly charts as well so as to get the full picture of what you are trading on and the techniques you are going to apply.