Common trading mistakes: part two

Common trading mistakes: part two free forex signals presents special offerrn open trading account with one of the best forex brokers and GET FREE forex Signals via SMS, Email and WhatsApp rnSIGN UP FOR A FREE TRIAL To Access FREE Forex Signals in the Members Area START FREE 30 DAYS TRIAL on https://www.freeforex-signals.com/ Overreliance on softwarernMost people use some form of technology to assist their trading. For example, you might study chart patterns or use automated alerts and algorithms as prompts to trade. But, as useful as all of these tools are, it is important to remember that they are only tools, and must be employed wisely. Just as your satnav can occasionally direct you to drive into a deep torrent of water because it doesn't know the river has flooded, trading technology isn't something to follow blindly. You still need to keep your eyes open and react intelligently to the signs you see. CarrnSo when using technology, such as charting software or other analysis tools, it's important that you understand the underlying concepts and the reasons behind what the charts are telling you. This will allow you to see the bigger picture and avoid unnecessary mistakes. Lack of record keepingrnDo you remember your first trade? What about the third, or the fifth? If you're new to trading, the details may still be clear in your memory. But in a few months' time will you still be able to describe each step and decision in detail? Unless you keep a trading log or diary, the chances are that this information will be lost. And if you can't remember what you did right, how can you replicate it? Similarly, if you don't know where you went wrong you could easily make the same mistakes again. Your trading diary will let you look back at your experiences with the value of hindsight and learn from them. So what should you record in it? QuestionrnWhich of the following is NOT worth putting in your trading diary?rnArnWhy you decided to tradernBrnWhat you were wearing at the timernCrnWhere you placed your stops or limitsrnDrnHow you felt at the time you opened and closed the tradern rnReveal answerrnBad timingrnTiming is not only the art of good comedy - it's also central to good trading. In the same way that a stand-up artist needs to deliver the punchline at exactly the right moment, you need to time your entry and exit from a market perfectly to maximise any profit or minimise any loss. Timing mistakes are common among new traders. So how can you avoid them? Although getting your timing right isn't an exact science, there are a few tools that will help you to act at the right moment: Chart analysis will help you forecast potential scenarios by revealing market patternsrnA trading plan will help you to define your strategy, meaning you're more likely to avoid impulsive actionsrnStops and limits will allow you to go about your business without having to monitor the markets constantlyrnsummaryrnRemember the limitations of software and use it intelligentlyrnKeep a trading diary and reflect on the strategies that have worked well (or not so well)rnUse tools such as charts, stops and limits to help you get your timing right when opening and closing positionsrn