Tips on How to Avoid Losing Money When Trading XAUUSD
With the market gaining more popularity among retail traders and investors & beginners need to learn how to correctly setup their xauusd investment activity so as to avoid losing money when trading XAUUSD.
The Market, a market that provides easy access to xauusd leverage & very low transaction costs when it comes to trading the Market: this makes this market easily accessible to retail traders and investors & also the fact that this is the largest and most liquid financial market means that even more and more traders continue to be attracted to start trading & investing in this financial market.
The following tips should guide beginners on what to do before starting to trade online and before they invest their money in the market.
Take Time to Learn Before Investing in XAUUSD
The first thing that every trader should do is to take time and learn about the online market before deciding to invest their equity in this market. For example, on this site there's a total of 100 learn lessons that traders should learn so as to understand & grasp all the basic concepts as well as advanced concepts that will explain to them what xauusd is all about and the various strategies used to trade trading as well as tutorials that explain to traders how to manage their account balance. Trader also learn about leverage, margin and how these two are used in trading & how leverage can increase profits as well losses & also what margin is and how this margin is calculated & why traders need to maintain enough capital in their account when trading on margin using leverage provided by their broker.
After learning all the tutorials, traders should create a plan that will set the rules which they will follow when trading xauusd. This plan will summarize all what they have learnt and will be used as the tutorial that a trader will use when trading the online market.
Practice XAUUSD on a Demo Account
The next thing that a trader should do before they invest their money in online market is to practice what they have learned and test their plan on practice account. The practice practice account is where a trader can learn how to place trades and trade the market but only that they will be trading on a practice account with virtual funds.
The demo account is similar to the live account and the environment is the same as when one is trading the live market using real money, the only difference is that funds which are being traded with on practice account is virtual money and there is no risk of losing money when trading on a practice account.
The platforms of most online brokers will provide option of opening a demo account, a trader can use this demo trading account to learn about the platform. Trader also will use this demo trading account to learn how to trade using different orders types provided & learn how to close trade transactions.
The trader can also test any strategy or any automated Expert Advisors before they decide if their strategy is profitable enough to begin trading with it in market.
Use a Plan & Stick to the Plan
Traders should always use the plan they create to trade the online market. The strategy that a trader chooses should be well written in this plan & the trader should always follow the rules of this plan when deciding when to open & close trade transactions.
If as a trader your chosen strategy is to use automated trade strategies & Expert Advisors then these automated strategy should be specified in your plan. Whatever system you decide to use as a trader, write it in your plan and stick to trading with that strategy.
Traders should also avoid emotions of fear & greed when trading in the market. The plan will help trader plan their trades and this way traders won't make trades based on their emotions. A plan will help a trader set clear goals when trading and at same time will help traders to stay organized when & thus ensuring traders become more successful when trading in market.
Keep a Journal To Track Your Results
As a trader always keep a journal & writedown all trades which you open in this journal, write why you opened each trade, when you closed the trade and also the amount of profit or loss generated from that trade transaction.
After a while you can then review the trades you've made try & look at why the losing trades made a loss & why the winning trades were successful & after that you can then try & do more of what makes you successful & less of what is making you to open losing trades and that way keep on improving on your strategy.
As a trader if you don't keep a journal you may continue making the same mistakes over & over again without knowing, but if you write & keep a journal & review this journal from time to time that way then you give yourself a chance to identify these mistakes that you make when trading from the review of your journal.
Choose a Reputable Broker Prior to Open your Account
Before you open a trading account with any broker do some research & find a reliable broker which you can do biz with.
Choosing a good broker will give you a chance at making profits from your activity. Choosing a online broker that is regulated is the best advice that you can get. Regulated brokers follow regulation rules set by their regulators & this means that these brokers are the best to choose from when opening a account as they are most reliable because they are licensed & regulated which means that they are legit.
Open Account When You Have Enough Capital To trade With
Xauusd trade just like any other business requires that traders open an account when they have a good enough amount of capital to trade with.
Xauusd trading requires that a trader starts trading with at least $1,000 if they will be micro lots & a minimum account balance of $100,000 if they will be standard lots. If as a trader you don't have the required capital it is best to save until the time you will reach the amount of money that will help you to open a well capitalized account. This will increase your odds of success when it comes to trading in the market.
Use Proper Gold Money Management Guidelines To Protect Your Account
As a trader you'll need to protect you account balance when trading if you want to trade profitably for a long time. The best way to protect your trading account is to learn about the proper money management rules & follow these rules when trading the market.
Xauusd money management rules will ensure that you'll protect the money in your account & that you'll have a chance of trading successful. To be profitable and successfully in long run a trader has to implement proper money management principles when trading. The money management rules that a trader will follow should be specified within their plan.
Xauusd money management rules will help a trader to minimize their losses & essential help the trader learn how to protect the profits that they make in the market using different principles specified by the money management guide-lines. Traders can learn about equity management from the learn tutorials section of this website.
Xauusd money management will also help trader know what amount of leverage is best to use when opening trade transactions. Leverage gives trader a good opportunity to earn profits from the borrowed capital. Trade is very popular because of the fact that traders using leverage can use little of their investment capital & borrow the rest of the money to make a trade. By using money management guide-lines traders will learn how to use leverage & know the best leverage to use when trading based on the account balance they have in their account.
Because leverage increases both the profits as well as losses, traders must create rules on how best to use this leverage when trading. By learning money management guide-lines used in traders will know how to decide what amount is best to use when trading using their gold strategy.
Summary
Traders should try & use the above approach so as to avoid losing money when trading xauusd. Following the above strategies trader can improve their chance of being more successful & profitable when trading the market.
