How to Take Trading losses in forex?

Trading losses?

Yes, trading losses are part of trading forex markets and any other market. It is like playing poker. You can be a winning player but you cannot win every hand. In forex trading as well, you can be a profitable forex trader, but you cannot win at every trade.

It is the realization of this simple truth and how you behave when such losses occur that makes the difference between a winning trader and a losing trader. It is a totally different story to discuss trading losses like in this article, then to take such real losses when you trade with real money.

It is the same in poker, and a poker player who cannot handle short term losses will make things worse by tilting, i.e. losing control. Losing control is the worse thing that can happen to you either trading forex or playing poker, because this is the best recipe for disaster.

Losing control or lucking a trading plan including the precise rules for entering and exiting trades will bring near certain doom to your long term results. Beginners almost always suffer from these such issues and it is part of the learning curve of becoming a good forex trader to develop a good plan and to follow it in all situations.

No exception!

Do not abandon your trading plan on impulse because you are taking some short-term pain as things are not going as you expected. Do not hold on to losing positions hoping for them to turn when every indicator tells you otherwise. If you cannot bear the thought of a loss, you cannot be a successful forex trader.

If you have trading losses, take them first as your plan says. Then try to identify what went wrong and to see if you can make changes that will improve your trading results. If it is hard for you to recognize that a trade or a trading method is not working, you will not be able to make the necessary changes to your trading methodology.

Trading is before all a psychologically game. Do not fool yourselves. Recognize the traits in yourself that induce a lack of control. Pull all you strength together to prepare yourself to be disciplined at all times.

Make sure to record every trade and all related information in order to analyze your trading results. Trade in a smaller size if this help you regain your confidence. To make another analogy with poker, when poker players are in a losing streak, it is recommended that they play at lower stakes in order to rebuild both their confidence and their bankroll. It is the same in forex trading.

The smaller the trade, the less the stress, especially for the beginner. If you need a break, take it. Do not get enslaved to your trading. Get away from it all. Take your mind off the trading.

The next thing to do is to make sure that you have a life. Poker and trading are potentially addictive because of the high flow of pain and pleasure that they bring to the brain. Do not make it your sole purpose in life. Balance it with your family activities.

Manage risk well. Accept what you get and enjoy the ride. Accept your limitations, work around them, and become a profitable trader. Write out your trading plan with precise entry and exit points. Set your stops and mentally decide you will follow them.

For new traders, test your system on paper first and only when satisfied with the results, test it in real time with the minimum contract size. Take your trading losses and move on to the next trade.