As highlighted in previous articles, the dropout rate for traders in our industry is frustratingly high and frighteningly quick. It’s frustrating to us analysts and advisors, because it’s needless and most traders exit because of self-sabotage. They continually fail to take on board the sound advice which is constantly delivered to them and continue to trade using overall methods that will harm their chances of success. Yet with simple modifications they can turn their trading around, and it’s actually never too late.
So if you’re about to quit, or thinking of quitting, we’d like you to consider this check list before you go, just to ensure you’ve squeezed everything out of: yourself, your trading plan and your strategy, before you remove your trading platforms from your PC, tablet and smartphone.
After posing questions to many fledgling novice traders, and having analyzed the many reasons folk quit trading early, we’ve identified four main reasons that cause us to give up. We’ll now highlight them and suggest quick remedial action that may gently nudge us back onto the right track.
“I’ve run out of money.”
None of us like to lose money, it hurts. In fact, the speed and ruthlessness by which markets can take money off you can be one of the most brutal experiences you’re ever faced with. However, if you’re exiting trading due to the losses experienced on your first account, you could start trading with a small account and try again. You may consider to have a better and different approach to trading forex from a more dedicated and professional perspective.One should ask the following question: Was I close to perfecting my trading plan and do I believe that with a bit for time and a little bit more money I can resume trading?
“I haven’t got the time.”
Trading doesn’t have to take up too much of our time, once we’ve begun to perfect a technique. The majority of part time retail traders either; day, swing, or position trade. If you swing trade, using a simple technical indicator driven trading strategy, then you can use all the technology available through your MetaTrader platform, to signal and link with your smartphone, in order to be alerted to any market changes which will encourage you take (or alter your existing) trades. This form of trading could be thought of as a form of medium to long term investing. Instead of aiming for 2% passive growth from your savings bank account per annum, you’re aiming for 2% active growth per week.
“It’s all too complicated.”
Trading is only as complicated as you make it. Always take into consideration the Mind, Money Management and Method. A simple moving average cross over strategy, only taking one day trade a day when price is either above resistance or below support, in effect never trading against the ‘daily trend’, can and does work for many traders. They repeat the same strategy day after day, they never risk more than 1% of their account balance. On some outlier days they might see 2% account growth, some days 1%, and other days they may lose 1%. However, they know that one percent loss is the max pain they’ll feel on a losing day and experience has taught them that they’re highly unlikely to ever experience three losing days in series. And even a 3% loss is far from terminal to their trading ambitions.
“I can’t deal with the emotions.”
Yes you can, let the terminal do the sweating for you. Contending with the emotions involved in trading can begin and end with automation. If you’re considering giving up on trading, then perhaps you should look into trading automation. Not only will you discover that your emotions now remain in check, you’ll begin to open up a whole new vista and perspective on trading.
Finally, before you leave trading, consider just how much you’ve learned over recent months; are you really going to condemn all that experience and practice to a memory? You’re probably closer to success than you think you are.
