Why do we sometimes lose money in forex trading? The answer is because of a lack of enough knowledge about the market, greed fear, and excessive trading.
Although losing is part of the game anyway, but beginners in the forex trading are the persons prone to lose money may lose me and blow their account 60% of the time. I am talking from a point of personal experience and I lost money in forex trading.
In December I was trading the forex with a simple strategy: buy when price fall to a new low or support and Relative strength Index is below 30 and a sell when Relative strength index is above 80 and price break a resistance. It was all going as planned although there were few losses. It was as if the market was in my favor.
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That soon stop as I decided to use a bigger lot size to make a bigger profit. I am talking from a point of personal experience and I lost money in forex trading.
I will never forget that currency pair, USDJPY, that is, I took my first loss 40USD. There is still hope, I can just buy a bigger lot so I can recover my loss 60USD was gone. The remaining 20USD was lost gradually because everything was just tilting loss only. I am talking from a point of personal experience and I lost money in forex trading.
My other experience, back in 2019. I was still struggling to know more about forex but I know I had another strategy. Things were going as plan. I regain my confidence. I was killing it big. On a faithful afternoon, I saw a forex ad saying they give 50USD startup capital on my browser, I click it and I landed on the broker platform. I am talking from a point of personal experience and I lost money in forex trading.
When I try signing up I was informed the offer no longer exists. So I just decide to sign up for an account with them. I was prompted with an update if I will need forex analysis to send to my email. As a beginner in forex trading, why not. I am talking from a point of personal experience and I lost money in forex trading.
Then the first analysis was sent to my mail, after some week. I cannot forget that pair AUDUSD, telling me to buy at some price. On that pair in my own analysis, the price was on support on an upward trendline, I was thinking price will break down from that level as my indicator was telling me to sell.
But you know this is a big brand and there no way they can be wrong, as a matter of fact, let me even buy a bigger lot size. That was it, I lost half my account to the wrong guys. I am talking from a point of personal experience and I lost money in forex trading.
So what the moral lessons
In forex trading, you must have your own trading rules and obey them.
In forex trading, make sure not over complicate thing.
You might be a beginner in forex trading, but if you put your head down you can still make a profit.
In forex trading, do not let emotion creep into your trading.
Finally, when you sit at the front of your computer, there an urge to just enter a trade, as if the market is calling you. But we must learn to resist that voice. One way to that is to have a profit target. If it is not 1: 4 risk versus reward I stay off the market. That is it. Please share your experience comment below your own shortcomings.