We all love trading and having time to analyze the charts can become a little tiresome if you have been at it for hours and there re no setups to suit your entry conditions, for both beginners and professionals, this can lead to mistakes being made or a desire for the excitement of a trade, but sometimes it is better to not take that trade, here are a few reasons why.
The market does not suit your trading strategy.
When you create a strategy, you also create a certain set of requirements from the markets, in order to open into a trade, the market must meet your preset entry conditions. The markets don’t always want to be friendly with you if your strategy involves trading the uptrend, but the markets are currently moving sideways, it clearly has not met one of your main criteria, so why would you enter the trade?
Sometimes it can take hours or even days for the markets to get into position and in line with your strategy, give it time, do not jump into trades that are no in line with your strategy, or you will quickly see how the mistake of entering the markets at the wrong time could cost you dearly.
You are bored.
The trading markets can be incredibly exciting, so much so that when you rent trading you are either thinking about it or don’t know what to do with yourself. This is not the time that you should be looking to trade, if you are feeling bored and tempted to enter a trade, make sure to stick to your strategy, do not trade for the sake of trading, it will only lead to losses.
You have just lost some trades.
The main downfall of many traders or gamblers or any other form of trading or gaming in life is chasing losses. When you see a story on the news or no website of someone losing everything or getting into debt from trading or gambling, it is often because they ave been chasing losses. This often occurs in the form of losing a trade, then making a larger trade to hopefully win back the lost value, if that loses, an even larger one is made. This is often known as a Martingale strategy or can also be incorporated into a grid strategy.
Do not do this, if you have made a number of losses in a row, then something has gone wrong somewhere, analyze your strategy, find out what has gone wrong and improve on it, do not trade just because you have lost a bit of money.
Remember, there is nothing wrong with not trading for a few days, if the markets do not suit your strategy then do not trade. If you really have that urge, then use a demo account. The forex markets will always be there and there will be appropriate trades, it is just about waiting for the right moment to take them.