Excessive Risk: Taking on a position size that is too large for your capital can lead to significant losses. Stick to the rule of not risking more than 1-2% of your capital on a single trade.
* Not Using Stop Loss Orders: Ignoring this essential tool can turn a small loss into a disaster. A stop loss protects your capital and limits potential losses.
* Emotional Trading: Fear, greed, and revenge can lead to poor trading decisions. Stay calm and stick to your plan regardless of market fluctuations.
* Chasing the Market: Entering a position late after the price has moved significantly can expose you to unnecessary risks. Wait for good entry points based on your analysis.
* Not Learning from Mistakes: Every loss is a learning opportunity. Analyze your failed trades to understand the reasons and avoid repeating them in the future.
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