OK,
It's a good time to discuss the mighty stop loss! I personally love stop losses. Why? because they save me from certain trading death! So let me be as clear as I can be...
Write this down so you can see it every time you take a trade.
(Write your name in this gap) If you are stupid enough to take even just one trade without a stop loss in place, you will lose all of the money in your account! Don't be one of the tens of thousands of forex losers! You're smarter than that.
Read that statement over and over again and NEVER forget it. If you trade without a stop loss, you're a fool! it's as simple as that, and don't ever think that it can't happen to you. I've been that person, so I'm talking from first hand experience. Within the first week of my trading career, I had taken some trades without the use of a stop loss...
I can almost feel the pain of that dark experience even today! what happened next I hear you cry? Major losses! All it takes is one bad trade, and you will end up in a World of hurt!
Write this down so you can see it every time you take a trade.
I'm only one bad trade away from trading disaster.
That's all it takes guys....trust me, one of the main reasons for me to write this information in the first place, is because I wanted to share my knowledge of my ups and downs since becoming a trader. The idea is to help you minimise any mistakes you're going to make, and to speed up the learning process.
I really hope you pay attention to this important information, it could mean the difference between life, or the end of your trading career or worst!
The world of trading is littered with stories of people taking their own lives as a direct result of terrible forex money management, it's no joke! People have even managed to bring down world-famous banks!
I think one of the main problems is this obsession traders have with the need to be right! traders should be humble, always ware that if they get caught slipping for one second, the market can hand them a hefty reminder of who is the Boss.
Your job as a forex trader, or any trader for that matter is to execute your entries and systems perfectly. Then, even if your trade doesn't produce a profit you did your job as a trader. This is very important, just because you didn't make money on a certain trade does not mean you lost! It just meant you did your job, and it was a non profitable event, NOT a loss.
However, should you not trade your plan, and you leave your rules and lose money, then I'm afraid it is a loss, and you deserve you take the hit. Learn from your mistakes quickly in the game, stick to your plan. Then allow the numbers to play out.
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