Why should you never exit the market early?

Traders are like the small kid who only wants to eat the sweets and do not want to taste sour. As a trader, you will have to eat the sweet and also the sours. Most traders think when the market is volatile; they should early exit the market to keep their profit and investment safe. It is not correct in Forex and most common traders make these mistakes. When you are in in this financial market, you have to think beyond what the other traders are thinking and make your own decision. Remember the success rate of Forex traders in making a profit is only 5%. If these decisions were so easy to make, everybody would be making profits in Forex. The retail traders are losing money consistently only because of their trading knowledge. They simply don’t understand the fact that without having a clear understanding about the nature of this market it’s hard to make a profit.Those who are trading Forex professionally have years of trading experience and in depth trading knowledge. So if you want to become one of the most successful traders in the world then start learning all the fundamental facts about trading.


It can be a false market trend

Just because the market is volatile does not mean you have to exit the market. Most often, broker and large hedge funds of the world try to manipulate the Forex market by making a false signal on the price level. This signal or false trend does not last long and traders can easily know that this is not the market trend. If you act instantly to every market trends, you will find it not difficult but impossible to make money. You need to know where a true market trend is and when the market is showing a false trend. Most of the retail traders have more winning trades in their portfolio but still, they are struggling hard to make money. This is only because of their poor money management skills. If you simply trade with 1:2 risk reward ratio then you can easily make a profit even with a 51% winning rate.


Time will smoothen market volatility

If you think trading in the market and exiting the market when the market is volatile is the only strategy to make money then you are wrong. In Forex trading, you need to let the winners run long. Think of the positional and swing traders for examples. These traders trade in the long timeframe and they keep their trades open for weeks and also months. Do you think they do not have volatility in their trades? They have more volatility than other traders as their traders are open for a long time. The secret they can still make a profit in Forex is they know time will smoothens the market volatility. If you give your trade long time, it will come back to its normal trend and you can make a profit.


Traders do not want to give their trades any time and they want instant profit. This is one of the most common reasons why traders lose money. If you give time to your trades in a volatile market, the volatility will end and you can make a profit in those seemingly losing trades. Once you place trade never change the take profit and stop loss level. It’s true that some advanced traders modify their running trades very often but being new to this market you should follow a fixed set of rules.


Summary: You need to have extreme patience to make a profit in the Forex market. You might find best possible trade setup but if you cut your trade early than you are not going to make any real progress. Always focus on the market data and trade with discipline. No matter what happens never execute any trade without high-risk reward ratio.