When you trade a lot, you quickly get nervous and tired. Overtrading is one of our main enemies, especially when you are on a path of success in financial markets or learning how to trade forex. But there are ways to stop over trading and always be ready for the next trade. And this is my answer to the question of how to avoid over trading?
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Just before we dig into more specific details, we should note that overtrading is a psychological issue. A very important and common factor among successful traders is that they have complete control over their self and psyche, so they do not suffer from such problems. You can also stay away from this black hole by following the recommendations below.
# 1 – Take a break after a major loss
If you have just experienced a major loss in the market, you have become unconsciously emotional, whether aware or not. To be more precise, the “big disadvantage” is different for each trader. For idealistic and professional traders, a 2% loss can be a big loss, but for gamblers it might be in a much bigger threshold. But again there are some of the best forex brokers in 2019 which warn you about these harmful behaviors.
However, no matter where the pressure is on you, you have to get out of the market for a few days or even a few weeks and allow yourself to go through the recovery time. If this break doesn’t go away, you are likely to overdo it and seek to avenge your loss.
# 2 – Trade over a certain number of days instead of overtrading
This advice may be difficult for traders trading in short-term time frames, but it’s really necessary. They know no bounds and can sit behind the monitor for a day and trade.
For example, at first I would even do 50 trades on some days but eventually I was satisfied with a maximum of 5 rides per day, these 5 trades if it were profitable to be good at it! But if it was a loser, I would shut down the Metatrader and not look at the charts until tomorrow. Looking at charts forces you to trade when you don’t want to trade. You have to overcome your fears in trading forex.
# 3 – Set the daily profit and loss limit
When it comes to profit and loss limit, the subconscious mind goes to TP or SL, which we specify in Metatrader for each trading position. But Recommendation number 3 has nothing to do with this. More precisely, you want to set a profit margin for your work day. For example, suppose my daily profit and loss limit is 2%, so even if I have 3 open positions and the first position is at 4% profit, the second trade is at 2% loss and the third one is at the top. , I close all my transactions manually because I have touched my daily profit target of 2%.
Certainly doing so involves overcoming the power of human greed and requires a bit of training and experience, however when dealing with open trades, the human mind will try to deceive himself that “if you open the deal you can Benefit more. ” But it is the selfless greed that leads to the bankruptcy of the traders.
Overtrading or over-trading is one of the most important reasons that keep traders from achieving their financial goals. Most newbies are eagerly trying to turn 100$ to one million dollars in a month, and that’s what makes matters worse. You have to be honest with yourself and place honesty at the heart of your trading job. If you follow the recommendations above, I promise you that you will easily achieve your financial goals.