Overtrading is a very common problem for rookie traders. The new traders love to trade the market and they always thinking by placing more trades they can earn more money. Trading is all about quality trade executions. You can’t make your life better by executing random trades based on emotions and aggressions. Consider professional traders in Hong Kong. They are using simple logic and placing trades with low-risk exposure. Even after losing a few trades, they never become frustrated in trading. Trading is nothing but the most sophisticated business in the world. You must overcome the problem of overtrading or else it will be really hard to make a profit from this market.
Quality over quantity
To overcome the problem of overtrading, you need to understand the fact, the quality will always bear quantity. If you focus on the lower time frame you will get many trading signals. But most of the signals have a higher chance to hit the potential stop loss. But if you trade the market in the daily time frame, chances are very low you will get more than one trade in a single day. But the quality of the signals associated with the daily time frame is extremely good. Most of the time you will make a profit from such setups. Embrace the fact, overtrading leads to a high-risk trading strategy. Try to be conservative trader so that you can make a decent profit from this market without having any stress.
Trade with the trend
You must become a trend trader to protect your trading capital in the Forex trading industry. Those who are trading against the major trend are always losing money. At times you might make some decent profit by trading the reversal but you need to understand the fact, the market always favors the trend traders. So, if you go against the major trend, you are trying to beat this market. This is where the pro traders are one step ahead they always trade with the major trend thus they never face the problem of overtrading. If you execute trades in a minor retracement, you will have tons of signals. This will eventually force you to lose a decent portion of your investment. Stick to the market trend if you intend to make some real progress.
Avoid using the indicators
Indicators is another key reason for which the retail traders are losing tons of money. If you execute a trade based on indicators reading, you will easily have more than 10 trades a day. This is not the professional approach in the trading profession. Instead of relying on the indicators reading, try to learn the manual art of trading. Trading strategy greatly depends on the traders. So, you will have to create a trading system from scratch. When you develop your trading strategy, make sure you are not using any indicators. It will help you to fight the problem of overtrading. During your learning stage take advantage of a demo account so that you don’t have to lose any real money.
Choose your broker very carefully
The selection of your brokerage firms plays a great role when it comes to trading profession. Never think you can change your life by trading the market with the low-end broker. You must choose your broker very carefully or else it will be really hard to do advanced technical analysis. Most of the time you will face heavy slippage and freezing platform issues. This will eventually make you frustrated and force you to overtrade the market. You need to have access to a premium trading environment or else you will fail to overcome the problem of overtrading. Trading is an art and you must master the skills required to find quality trades. Forget about quantity and try to find quality trades in favor of the major trend.