#TradingMistakes101
Of course, here is a short article about common trading mistakes:
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Common trading mistakes to avoid
Trading in financial markets can be profitable, but it is also fraught with risks, and making mistakes is common, especially among new traders. Here are the main mistakes to avoid to preserve capital and achieve better performance:
1. Lack of a plan
Many traders enter the market without a clear plan or defined strategy. This leads to random decisions that are not based on analysis or clear goals, increasing the chances of loss.
2. Not using stop-loss orders
Ignoring to set stop-loss orders can lead to significant losses when the market moves against you. The stop-loss is the first line of defense to protect capital.
3. Greed and fear
Many traders are influenced by emotions, closing winning trades early out of fear of loss, or holding onto losing trades in the hope of a recovery. Controlling emotions is fundamental to success in trading.
4. Overtrading
Making a large number of trades without sufficient analysis leads to account depletion and increased costs. Quality is more important than quantity in trading.
5. Trading with large size without capital management
Leverage is tempting, but it can be a double-edged sword. A fixed risk percentage should be determined for each trade, and a large percentage of capital should not be risked all at once.