DEALING WITH LOSS
Learn from your Forex loss and move on to the next trade
If you are dealing with online trading, sustaining a loss is almost inevitable. But a smart trader keeps record of his losses and learns from them. To make sure that your morale and confidence does not go down, you need to be able to handle losses and deal with them professionally.
The most difficult part of forex trading is dealing with the losses. No matter whether you are a beginner or a professional, chances are that you will suffer loss at some point. The loss a trader makes can sometimes push them into making mistakes that cause them even further harm in the market. From then on, a trader’s stock account could take a vicious downwards spiral.
Developing a strategy:
To be able to deal with your trading loss and not to allow your losses to have a negative impact on your trading account, you must have a strategy which helps you deal with it. For this reason, you need to understand the logic and reasons behind the losses.
Here are a few facts that you need to know:
Trades that result in loss are bound to occur and you cannot avoid them. No matter how professional and experienced you are, you cannot run away from losses. The good thing is that it’s only the price of the purchased lots that you lose. When you suffer a loss, your goal should be to ensure that your maximum investments are protected.
Moreover, you want to make sure that the amount of money you lose is limited. You can get this done by setting a stop and limit order and thereby control the extent to which you follow a losing order. Working on this strategy reduces your losses significantly and protects your major investments.