Causes of the Difficulty of Consistent Profits in Forex Trading

Trading has a very large profit, but besides that trading also has a very high risk. No wonder so many people get involved in trading to get profit opportunities. Unfortunately, running a trade is not a very easy matter, just sell and buy. when you enter the world of trading, you must really have sufficient knowledge, so that in the analysis later there will be no mistakes that make traders lose and do not even last long in trading.

The key to correct trading starts with a careful trading plan. If the trader already has a good trading plan, then the trader performs optimal trading activities and can generate profits consistently.

Success on previous trades makes traders addicted to trading continuously. However, in the midst of trading, sometimes you will meet a failure or loss. Even this loss can occur more than once or the amount of loss is more than the amount of profit the trader gets. This situation is called inconsistent profit.

Causes of Inconsistent Profit

Inconsistent profits can occur for several reasons. One of them is a trader who does not evaluate the trades made so far. Just imagine if a novice trader does not have an activity evaluation report to find out the reasons for failure or the emergence of other risks in his trading. Traders who only guess without directly evaluating the system will not find a bright spot for the problems they get. Switching from one trading system to another is also not the right solution. The main purpose of the evaluation is actually to find out where the advantages and disadvantages of the trading system are.

Benefits of Trading System Evaluation

Similar to students who need report cards as reports and evaluation materials at the end of learning, trading also requires evaluations that can be used to evaluate things that happened during trading. Other advantages that traders get when conducting evaluations include:

Fixing Trading System Weak Points

Execution errors can be one good evaluation material. This is due to frequent execution errors. Evaluations can provide warnings, for example, when exactly a currency pair has lost. If this evaluation has been carried out, the trader can avoid the possibility of this happening again in the future so that the risk of inconsistent profits will be avoided.

Knowing Market Conditions and Profitable Pairs

Previously we have discussed evaluation that can be used to find out when market conditions are favorable. In addition to showing the time, evaluation can also help find out what currency pairs are generating profits for the trading system. So that in the future this trading system can consistently repeat success in more specific situations.

Predicting the Worst Profit Target and Risk

This is an important point of the evaluation results. Traders certainly cannot eliminate risk altogether and want to continuously earn profits. This is why when opening a position, a trader must calculate how much risk he has to take to achieve the targeted profit. If the profit and risk target predictions have been made, the trading system has a high probability of consistently making profits.

Maximizing Profit with Trading Psychology Formulas

Experimenting with a demo account is one of the conventional ways to evaluate a trading system. However, the demo account cannot always represent the trading conditions on a live account because the performance of the trading system of a demo account cannot be applied exactly to that of a live account. In fact, if you test the trading system on a live account, there will be a real risk of loss.