There are many traders in this world dreaming to make millions of dollar. However, most of them are failing and only 5 % of the traders are making consistent money. So who are these 5 percent people? These five percent traders are the educated traders who trade the market with the extreme level of discipline. By the word “Education” we are not referring to any University degree rather we are focusing on the trading education. Very few of them have a real trading education. In Singapore, people are a little bit smart since they know without learning all the details of this market, it’s impossible to make money. And most of the retail Singaporean traders spend a decent amount of time on Forex education and trade with the professional broker Saxo. This article will give you some useful information regarding the mistakes that most of us make during our early part of our trading career.
Mistakes of price action traders
We all know that price action trading is very much popular among the professional traders yet the new retail traders hardly make any money by using this system. This because they don’t know the perfect way to do price action pattern analysis. While drawing the trend line or channel many traders often ignore the wick of the candlestick. But if you do this then you will never be able to place your trade at the perfect place. Even most of the time you won’t be able to understand the basic difference between valid and false breakout. So always use the candlestick which while drawing the key levels of this market. And if you are new to this price action trading strategy then learn basic rules of drawing the key support and resistance level. Always remember without having a strong foundation in this sector you will not make any real progress through your trading experience.
Unclear technical parameter
Trading the unclear technical parameters is a very practice of the novice traders. For instance, many novice traders execute their short orders after seeing the head and shoulder pattern. But to make money you need to wait for the breakout of the neckline. If you are not sure how you should trade the chart pattern then you should use demo trading account to learn how this market actually works. Chart pattern trading is very profitable since it allows the traders to catch the large movements of the market. Never do your technical analysis in the lower time frame since it is one key reason to lose money in the online trading world. Always trade in favor of the market trend with clear trading signals.
Fine-tune your entry point
Finding the perfect entry point is very crucial for your success. Instead of over trading the market you should always trade the high-quality trading signals. Most of the successful traders do their technical analysis in the daily timeframe and at times they switch back to the 4-hour timeframe for better accuracy. Instead of using the indicators to find your entry point you main focus should on key support and resistance level. If you simply learn support and resistance level trading then it will be enough to give you decent profit in every single month. But as an active trader, we highly recommended you to learn the reliable price action candlestick pattern so that you can have a great level of accuracy with your entry and exit point.
Potential target of the market
Once a chart pattern is formed the market provides a specific range of price movement to the traders. For instance, if you spot a triangle pattern in your daily time frame then after the breakout you might see some ranging market but it will eventually cover the distance which is equal to the height of the triangle. So before any price level is tested you should never execute any trade in the middle of nowhere. Only use the key support and resistance level to place your trade.