It is reported that the vast majority of new entrants into trading the forex market go out of business. There are numerous reasons for this of course, however some of the reasons are very basic and can be addressed both quickly and easily
. In this article I want to share with you one seemingly insignificant reason. This reason is not of itself a reason for failure, but the reason for this absence will almost certainly lead to failure.
The reason behind failure in trading forex can be traced back to a lack of or even absence of good accurate records of the trades previously taken. Unless and until a trader starts to keep records about what they are actually doing every time they enter the market and risk their money, they are trading blind. Accurate and indeed perfect records are the torch that will show the trader where they have just been. They will form the backbone of the analysis that will show the trader the strengths and weaknesses of their trading activity.
If this point seems an unlikely cause of failure then look and see what businesses keep for records. Sure they have to keep financial records for reporting their dues to the tax authorities. On from this though successful business owners know that records of their trading activities can render very valuable information that can show them where their real profits lie in their operation.
It is no different in successful trading. The trader with the best kept records is far more likely to become profitable and stay that way.
So what to include? The quick answer is as much as possible. If you use a paper based system to record your trades then size of space available is a consideration. Using paper is a great way to viscerally and emotionally connect with your trades. This is especially important at the time just before you enter a trade.
Think in terms of the following information-- Time and date. The amount you are putting at risk. The entry and exit prices. Your target price for profit taking. Your management technique for the trade. The price of the trade and the time you place the order and the time you are filled.
Then have a place for the reasons why you enter the trade in the first place. Lastly of course the outcome and lessons you learn form the trade. These are just a few of the sort of topics well worth noting if you wish to stay in the trading business for the long haul.
By the way, do you want the formula for building a full time income through trading the foreign exchange - forex - currency market? If so, listen in to my next webinar here-- http://www.wealthcubed.com
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