When there is a problem there is always a solution. But the question is, do you have the solutions ready? Or, is too late to find solutions to your problems? Considering this reality we will focus on the five unexpected problems the new traders might face in Forex trading profession. The majority of the traders are busy in developing their trading strategy. They hardly give time to list the major problems which they might face as a retail trader. After reading this article you will have a better idea about this market and above all, you will be able to save a huge amount of money in the long run.
Force closing trades
At times the Forex market becomes extremely volatile and it becomes almost impossible to trade the live assets. But those who have running trades might face different problems. Some of you might have experienced your stop orders are not being filled at the correct price. You are expecting heavy slippage. Though this is very common it can cause catastrophic loss. Let’s make it clearer. Imagine you have a long trade in the EURUSD pair. All of a sudden the market dropped more than 150+ pips and your stop orders is not being executed. So do you really think you should wait and see what happens next? In such situations, you will have to try to close your trade manually. You might get off quotes but still, you should try with different device or network to close that trade. And if the slippage exceeds normal level consult with a broker to the best solutions.
Widening of the spread
Those who are long-term trades are not concerned about the market spreads. But this is a major mistake. During the weekend, if you open your trading platform, you will be surprised to see the widespread of the market. The spread becomes extremely big when the liquidity pool is dry. In order to experience tight spread trading environment, you broker must ensure a high level of liquidity. But during the weekend the global transaction is extremely low and there nothing much your broker can do. So always be prepared to use wide stop loss when you carry your trade over the weekend.
Safety of your funds
Finding a well-regulated and reputed broker like Saxo is very hard. Unless you trade this market with a professional brokerage firm there is no assurance your funds are in the safe hands. You need to do the hard work and chose a reputed broker. The low-grade broker will offer you cheap trading environment but their offered service is horrible. In fact, you might get scammed if you deposit a huge amount of money. They will just send you an email regarding the violations of their terms and conditions. To be honest there is not much you can do to get back your money from this scam broker.
Those who consider trading as their full-time profession should be well aware of the long holiday season. Though the market volatility is entirely low you should never execute big lot size. Most of the time the market exhibit big spike to hunt down the tight stop orders. To be honest, it’s better not trade the market during holidays even though your broker will have an active platform for trading.
Buying EAs and bots
The new traders often things EAs and bots are the best way to earn money from this market. But do you really think this will help them to make money in the long run? You have to learn manual trading strategy to ensure your future stability. Consider you have a very good EAs but all of a sudden the market has changed its nature. So it’s very obvious will lose huge money without knowing the changed factors of this market. So learn manual trading to protect yourself in this industry.