“Let’s relish the time when we continued generating profits in spite of the floating losses”
1.NZDUSD: We can definitely guess when the market is sideways by studying the market pattern in a certain area, like NZDUSD pair was playing in 0.68110 to 0.73773 areas dated 05th may to 01st July 2018. It shows whether we buy or sell, we will generate profit despite of the floating loss.
“Then comes the time where we encountered a margin call or a top-up”
2.GBPUSD:The market was going sideways; the profit making was on-point! A sudden change in the trendline like from 22nd Jan to 23rd Jun 2016, the GBPUSD pair moved sideways from 1.39980 to 1.47734 areas encountering a sudden free fall.
We tried holding the position for a while, but the prices didn’t returned as expected and we have to make a choice among margin call or top-up account and hold the position.
From our past experiences, we can recognize our short-falls and can work upon two of the major losses causing factors listed below:
Holding a Position Contrary to the Market
Between being a perfect contrarian and going against the trend, there is always a fine line. One can always challenge the market trendline, but an evident opinion should be there to support the contrary position. Otherwise, you’ll be always standing against the market and the crowd in a hope for reversal and end up reaping losses.
We all are acquaint with the saying “follow the trend”, which means follow the market trendline and get the benefits. So, in order to succeed with every passing day, you have to study the market trend and hold a position in sync with the market, otherwise you’ll end up generating more losses than profits.
Risking More Than 2% per Trade
It is always advisable to follow 2% money management rule while trading. Risking more than that might result in losing your money. Following this 2% rule is the most significant part of trading in order to avoid suffering from bigger losses.
One can utilize all his capital on a single day trade or even more while utilizing leverage. But, the implementation of 2% risk rule shows how precisely you take your risk management steps for preventing your capital from declining further in an unfavorable condition.
Here are a few instances:
On January 2015 Swiss Franc (CHF) market crashes and CHF strengthened more than 2,000 pips in a day.
On June 2016 GBPUSD fell more than 1700 pips within 3 days.
During 2016 US Election, XAUUSD rose up to 500 pips and next few hours encountered a free fall of 1500 pips.
The two factors discussed above clearly indicated where we lack as a trader and how the amalgamation of our experiences and skills can help carve our career as a full time trader.
The trading strategies have been tested for more than 2 decades and can help you generate enormous profits. You can join Ttsmarkets family today and further enhance your trading horizons.
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