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The forex trader is confronted with several choices every minutes in the market. The pair to trade, lot size to use, placement of stops and exit points, to pyramid a winning trade, when to trade e.t.c. Inability of a trader to make timely and wise decisions along these lines can have dire consequence on the the emotion and equity of the trader.
However, the most important decision and resolve a trader should be capital protection. Unfortunately this is not the case for many traders. Hence they keep blowing up their account and many frustrated out of the money market. They came to with a paramount determination to make profit. This mindset is good but should not primary. If profit making is your main focus you will overly emotional. You will clinch to every little move in the market, use lot size without calculation. You will hold to a losing trade hoping it will reverse only to be disappointed. It can also turn a winning trade to a loss.
On the other hand if capital protection becomes a paramount determination you will eventually become a profitable trader. You will be a master of the three killer emotion of traders-greed, fear and anxiety. It will determine your lot size,stops,exit etc. Money management will be internalized. Above all you will make better decision in other areas.
Now you know why many traders keep jumping from one EA and systems to the other.They never become professional in the money market.
As a trader and fund manager I have enshrined this paramount determination in every member of my team. The rule is simple: Never to lose investors fund. Capital protected is better than profit opportunity lost.
I will appreciate your comments on this short post.