Seven Steps To Take After A Losing Trade

Jarratt Davis

Special Consultant to the FPA
All Forex traders have been there – obsessing about a losing trade. Trust me, it’s something I’ve experienced many times. And when you’re new to trading, these disappointments can be difficult to move past. But don’t worry – I want to help. Below are seven steps to take after a losing trade.

1. Stop Trading

If a trade hasn’t turned out how you intended, the one thing you can do is step away from the situation. Even experienced traders can become frustrated in the heat of the moment. My remedy? I try to do some form of exercise. Tension in the body doesn’t help the decision-making process. Just do something that you know will help clear your mind. It could be as simple as taking a walk or talking to a friend.

2. Put Your Trade In Perspective

Once you’ve had some time away from your losing trade, your next task is to put it into context. It’s important to remember that all traders suffer losses – it’s a normal part of trading. Therefore my recommendation is to look at your past ten trades as one batch. In other words, determine whether your trading loss is part of a larger pattern. Depending on your experience, your profitability goal will vary. But ensure you judge that over a number of trades. If your trading loss is an exception, rather than commonplace, stick to your approach.

3. Look At Risk Management

Should your last ten trades reveal a trend of inconsistency, it’s time to address the situation with a clear head. With that in mind, the first aspect to look at is your risk management strategy. If you don’t have one, I guarantee this is your reason for experiencing losses. A risk management strategy is simply the means by which you protect your trading capital. It’s a series of steps traders implement to ensure they mitigate their market exposure – such as using stop loss/take profit levels and checking currency correlation. To help you formulate a risk management strategy, I published this post a little while back. If you don’t have a strategy in place, please read it.

4. Scrutinise Your Analysis

So if your risk management approach is sound, the next thing to assess is your fundamental analysis. When the market moves against our open positions, it can just mean our analysis was plain wrong. It happens – the markets are unpredictable in nature. As a beginner,fundamental analysis can seem intimidating. But if you’re consistently making the wrong call in your trades, it’s possible that you’re focusing on the wrong risk events.

To fix this problem, ensure you watch my ‘Forex News Trading Strategy for the Week’ videos. They’re posted here on FPA every week.

5. Assess Your Timeframe

Have you ever stepped back to think about what kind of trader you are? It has a significant impact on your ability to make profitable trades. For example, it could be the case that you’re not well suited to taking trades over longer timeframes. Therefore, if you’re a long-term trader, you need to be able to tolerate letting your trades run their course. Often, they’ll be periods within these longer timeframes where natural price fluctuations will dip your trade into the red. And this can happen even if your position is correct.

Conversely, if you’re an intraday trader, you could be having trouble with your entry and exit points. Trading over shorter timeframes is more intensive; it requires you to be at your trading station, keeping a close check on price movements. Should your circumstance limit your ability to spend this amount of time on trading, consider moving to a long-term strategy.

Determining optimum entry and exit points is something a lot of traders struggle with. But the topic is often made more complex than it has to be. In the video below, I explain my approach to entry and exit points:

6. Find A Trading Buddy

I’ve found the phrase “a problem shared is a problem halved” to be true in every aspect of life. Forex trading is no exception. It’s why I encourage you to find a trading buddy. In other words, another Forex trader who you can regularly talk to for feedback and support. Don’t know where to find a Trading Buddy? FPA is a great place to make new friends. Something which has always amazed me about traders and wider community is their willingness to help one another. Failing that, if you genuinely need advice, feel free to leave a comment on one of my posts. I always try to respond to as many comments as I can.

7. Consider Professional Training

Of course, one of the best ways to stop losing trades is to embark upon professional training. My training requires a real investment of time and dedication – but it yields amazing results.

On the other hand, if you’re not ready for professional training, I encourage you to closely follow my updates here on FPA. By doing this, you’ll pick up useful insights that could make a big difference to your trading.

Seven Steps To Take After A Losing Trade

I hope you’ve found this blog post useful. Remember, losing trades are to be expected. But don’t become discouraged – mistakes are how we learn and make progress. It’s certainly how I developed my trading in my formative years.

Have a question? Please leave it in the comments below. I’ll do my best to answer as many as I can. If you’re looking for a trading buddy, you should also make yourself known in the comments – someone might respond.


Good day Guy's, in fact I need Buddy's..I have been trading for long time now but I still lose all the time, I'm so confused....I need a guidance...I love this business so much but I'm finding difficult to hold my ground on it....


Sergeant Major
Good day Guy's, in fact I need Buddy's..I have been trading for long time now but I still lose all the time, I'm so confused....I need a guidance...I love this business so much but I'm finding difficult to hold my ground on it....
Learn from Jarrat,you will be profitable trader.
I never miss any video or lesson post from Jarrat.He is really a real deal.
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