The Reason Why Traders Lose?


I have seen many times that new traders don’t stick with their strategy. Forex market is very volatilities and it seems that there are many trading opportunities, but actually there are not, as market moves swiftly revert back to initial stage. So, don’t get tempted, just sit and wait for your signal
There is only one reason why traders fail to win and the answer is really simple,traders lose more than they win”. That's it in a nutshell, everything elseis just pure conjecture.

To be successful in the financial market of your choice does not require that you are fully aware of the basics of that market, i.e. What is forex? What is the stock market? You don't need to understand how indicators work. In fact you can successfully trade any financial market without any prior knowledge of that market whatsoever. What's more you don't even need to follow a trading plan, (a golden rule for the trading connoisseur).

If you have the ability and understanding to be able to read and analysis a financial chart you can become more successful than you ever thought possible.

What's more chart reading and analysis is the same for every financial market that uses trading charts. Therefore learning the ability to read and analysis one financial chart means you can do the same for any other financial chart, whether they are stocks, commodities or even the more exotic traded funds.

What is 'Trading'?
The first thing you need to understand is the concept of 'Trading' and what 'Trading' actually means? Although in most financial markets today 'Trading' has become all encompassing but you will find that the term 'Trading' really does have a raison d'etre, a specific meaning.

Trading only begins the moment you click trade execution (buy or sell) and trading stops the moment you click stop trade. And that is all 'Trading' is. Regardless of what others may try to infer to you anything else is simply not trading.

Those other so-called 'Trading' tasks which appear under the 'trading umbrella' come under totally different headings. For example the 'trading strategy', it does not trade, it simply tries to locate entry points from which you can then trade.

The Problem
An article on the DailyFX* website in which the author had access to 40 million real trades derived from a major FX broker across 15 most traded currency pairs from 3/1/14 to 3/31/15 appears to verify the belief that it is the inability of traders to make more profit than losses which is the sole problem for traders losing in all markets.

The article quoted that the evidence revealed that the average trader when winning gains $50 but loses $500. This confirms that it is a lack of 'Trading' knowledge which makes it difficult for the new, inexperienced and even the more experienced traders from getting a foothold in to the market.

However, while the article clearly identifies the problem, the failure of the author to grasp the simple answer behind the analysis shows how deep seated this problem really is.

The answer to the problem of, Why do traders lose? is, most traders lack the ability to trade. But how can treaders be expected to understand a concept they genuinely have no idea exists?

Traders need to be educated in the art of 'Trading'. To be taught that they influence their trades while still in progress.

Without this type of 'Trading Education' traders will continually fail at a high rate.

* Article quoted: D
Very good points there Shevvy. I would like to add that risk/reward ratio is also key. Like you said, there isn't one strategy that works, but I prefer to set a TP double my SL and I don't risk more than 2.5%.


I also cannot specify or give any reasons for that. Everyone is not saint or lucky that much and will loose at some point for sure. How do you really go about that ? Isn't that hard to find and understand ? All those rules of why we loose seems do not exists.


Sergeant Major
Traders lose because of lack of discipline and patience, it is a well-known fact. They start to open big positions with high leverage and volatility swings basically push them out of the market quickly. You can even try to bet with opposite positions, without risk control you will also lose because of volatility. I've adjusted my leverage at Hotforex at 1:50 to avoid such situations.


Private, 1st Class
Some feel lucky while trading others are disappointed because as they place order they are unable to match market , face loss again ans again. That is why people say forex is highly risky business. Once you face loss, find out the reasons so that you must not repeat mistakes.


I think that lose deals are not an issue as long as trades are ready to have introspective look at them. In this way, lose deals can be best teacher on the market as they will without mistake show what is wrong with our trading skills or strategy


Private, 1st Class
Hello fellow traders

I used a very simple startegy with 3 indies based on elliott waves and Bill Williams work

Here below is the market analysis video for the coming week of trading

Happy trending



I agree with the views up here, that there are many reasons why traders lose. Actually, from my point of view, there are three main reasons that lead to loss in trading. The first on is greed, the second one is lack of trading discipline and the third one is inadequate trading information


Private, 1st Class
There are many reasons why traders lose. Top among them is lack of trading information and greed. New traders just get enticed to invest large amounts of money before digging deep to get as much information as possible to help manage risks and avoid scams. Greed makes traders to go blindly into deals that are too good to be true and end up overtrading the market


There are hundreds of reasons in this regard. Many traders lose their money due to their wrong behavior, many traders lose their money due to the lack of experience, and many traders lose their money due to their lack of knowledge. You have to improve in these fields for getting success as a trader.