After spending nearly 2 years of trading and losing nearly $2000.00 I have learned the reason why 95% of all traders fail. It is the same reason for any business, why some of them fail. Well here is what I learned.
1. Traders allow their emotions, greed, hope and assumption to take over their trading. This is probably the most difficult thing for a trader to do is to eliminate those things while in the Forex business. Did I say "business"? Oh yes it's a business.
2. Lack of Education. Most traders (myself included) are very arrogant when they first start trading. After a couple trades they figure they know it all, but they have not gone through any class or school such as Babypips School. They have not gotten the proper education at all. Well let me remind you, always get your education first, and education never stops.
3. Undercapitalization. Most traders think all they need is $100 or $200 dollars to start the business but they are sadly mistaken. If you want to start a business with Forex, I strongly recommend you start with a MINIMUM of $2000.00. Oh yes, if you want to use $100 or $200 to start, then just use that as "demo" money. Consider it already gone. But most brokers will allow you to start with $5000.00 "virtual money" (play money) to trade with.
4. No plan. I know that some traders think they can start a business with no plan in mind. I did that. That's one of the reasons I lost money. I had no plan, no goal. What the trader needs is a plan on how to trade, when to trade, what time frames to use, etc. etc. Without a plan there is nowhere for you to go.
5. No rules. This is very important. Perhaps just as important as all the others, but the trader also needs to make a set of rules and write them down. Without a set of rules you will most likely be making blind trades and hitting stop-losses or margin call.
6. No discipline, no consistency. This was a big problem for me. At first it was hard to follow all the rules because I was so eager to make money and I was rushing into it all. The trader needs discipline and consistency to make money in forex. Also, the trader needs patience. Don't worry, the money will come.
7. No money management and overleveraged. This cannot be stressed enough. As it has been said many many many times, manage your risk while trading. I know I risk a little more while trading, but my system tells me when a good trend has started. As long as I follow that rule about my trading, then money management rules are also followed. But that doesn't mean you can risk that percentage also. A trader MUST risk very little when starting, perhaps 1 to 2% only. Once you get good experience in trading then and ONLY THEN you can raise your risk SLIGHTLY.
If anyone else has any suggestions or reasons why 95% of all traders fail, please reply to this thread. Thanks.
Pierre (RedRobin)
1. Traders allow their emotions, greed, hope and assumption to take over their trading. This is probably the most difficult thing for a trader to do is to eliminate those things while in the Forex business. Did I say "business"? Oh yes it's a business.
2. Lack of Education. Most traders (myself included) are very arrogant when they first start trading. After a couple trades they figure they know it all, but they have not gone through any class or school such as Babypips School. They have not gotten the proper education at all. Well let me remind you, always get your education first, and education never stops.
3. Undercapitalization. Most traders think all they need is $100 or $200 dollars to start the business but they are sadly mistaken. If you want to start a business with Forex, I strongly recommend you start with a MINIMUM of $2000.00. Oh yes, if you want to use $100 or $200 to start, then just use that as "demo" money. Consider it already gone. But most brokers will allow you to start with $5000.00 "virtual money" (play money) to trade with.
4. No plan. I know that some traders think they can start a business with no plan in mind. I did that. That's one of the reasons I lost money. I had no plan, no goal. What the trader needs is a plan on how to trade, when to trade, what time frames to use, etc. etc. Without a plan there is nowhere for you to go.
5. No rules. This is very important. Perhaps just as important as all the others, but the trader also needs to make a set of rules and write them down. Without a set of rules you will most likely be making blind trades and hitting stop-losses or margin call.
6. No discipline, no consistency. This was a big problem for me. At first it was hard to follow all the rules because I was so eager to make money and I was rushing into it all. The trader needs discipline and consistency to make money in forex. Also, the trader needs patience. Don't worry, the money will come.
7. No money management and overleveraged. This cannot be stressed enough. As it has been said many many many times, manage your risk while trading. I know I risk a little more while trading, but my system tells me when a good trend has started. As long as I follow that rule about my trading, then money management rules are also followed. But that doesn't mean you can risk that percentage also. A trader MUST risk very little when starting, perhaps 1 to 2% only. Once you get good experience in trading then and ONLY THEN you can raise your risk SLIGHTLY.
If anyone else has any suggestions or reasons why 95% of all traders fail, please reply to this thread. Thanks.
Pierre (RedRobin)
............these people knows so many indicator and system..and i don't know anything 
...and reading all post.......understanding many indicator and system . this wasted my huge time,..... so many system..so many indicator..so many thread..and complete lost 
.............then after total frustration i realize something......i make my own setup where i can visulize price actions and price dynamics 
. and then saw how market works.
hoping they will find right way to understand FX.
