Success in trading can only be attained with the right knowledge and experience in the industry. On your road to success, you might encounter several mistakes that can test your ability to resolve the issue. Correcting these mistakes is very important so you won’t do it again in your future trades.
Don’t try bottom fishing
What is bottom fishing? It happens when a trader tries to catch a company stock when it drips down. But this isn’t actually a great idea. It is a way to lose a lot of money in one go. In the stocks market, if traders remain interested in a stock, it will continue to rise. But when the crowd losses their interest in the stock, its price goes down. Until such time that the investors start to nibble, the stocks will stabilize again. But there are instances in which the stock remains at the bottom for a long period of time.
Do Not Time The Top
There are similar characteristics shared by tops and bottoms – they do not always arrive when they are supposed to. Whenever traders become excited, they tend to keep on buying to the point that it doesn’t make sense anymore. For this reason, shorting a stock that is already trending in a higher position doesn’t make sense at all, despite the price being utterly reasonable. Don’t simply buy, wait for the right trading signal before you enter a trade.
Avoid trading in MetaTrader 5 against the dominant trend if you trade in the market that’s against the dominant trend, it will be costly on your side. But then, misidentifying a trend is a mistake that’s very easy to make. You may see the trend as a promising uptrend only to get it pulled back within the intraday charts.
Do not easily believe other people
The guy from the television said that the stock was heading higher and higher. You may think that he is providing some good information but this shouldn’t be your reason to buy the stocks today. Create a strategy and plan your trades. Execute your plans accordingly and wait for the right time when your signal gets triggered and when that happens, do not hesitate or doubt yourself.
Do not get too emotional
When money is involved, it’s a different thing. You get too conscious with your moves knowing that your hard-earned money is at stake. Being emotional when you trade will only get you in trouble. Fear and greed are two of the most common emotions felt by traders. When they lose, they get too scared to take risks and when they win on their trades, they tend to get too excited that they get out of their trading plan.
Do not forget to use stops
Not using stops is like going to a battle without armor. You will surely get wounded and might die. In trading, if you don’t use a stop loss, you will expose yourself to high risks which will eventually wipe out your capital. There are also different tools and indicators in MetaTrader 5 to help you get along with your trades and become profitable even if you are still a newbie.
