All traders will take a hit on their trading at some point. When this happens you need to know how you can bounce back from this trading hit. There are a number of options that you can look at and you should know what these are. There are also a number of steps that you should take to ensure that you are looking at the FX rates hit logically and without emotion.
The Three FX Rates Bounce Back Options
There are three options that you can look at when you take a hit in you trading. The first is that you close all your positions and take the profit or loss that comes with this. The second option is to increase your trading to cover the losses that you have made. The last option is that you do nothing and continue trading as you were. There are a number of pros and cons that come with each of these options. It is important that you consider what they are and whether there are any alternatives.
Closing Your Positions
There are a lot of traders who take a hit on the market and cannot overcome this. These traders will look at closing all of their open positions and stop trading. While the benefit of this is that you will no longer have to worry about the trading losses you could make the drawbacks is that you are no longer trading. This is possibly the worst option you could choose as you are cutting your trading short.
Increasing Your Trading
There are many traders who feel that the best way to bounce back after a trading loss is to increase their level of trading. This is done to make back the money that you have lost on the market. The advantage to this is that you could make back the money and you will continue trading. However, the drawback is that this trading often falls into revenge trading. Increasing the amount of trading you complete may only add to your losses.
Continue as Normal
Continuing as normal is possible the best out of these three options. Of course, there are some issues that you need to be aware of. When you continue as normal you are not letting the loss get to you which is the main advantage. However, you are also not taking the time to figure out what went wrong. The trading that you are doing could be the reason why you made a loss.
Assessing the Damage
The best way to bounce back from an FX rates trading hit is to assess the damage. You need to consider how much you have lost, how this affects you trading and why you made the loss. Looking at these points can help you plan for the future and determine what your next step will be.
When you assess the losses you can determine whether or not you still have the capital to continue trading as you once were. You will also be able to determine what you did wrong and fix this. This can prevent future losses and allows you to learn from your mistakes.
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