Trading Forex Without a Plan: Is It Possible or Risky?
One of the most typical temptations in forex trading is to jump in headfirst and depend solely on market emotions. Is it dangerous to trade FX without a plan? Now, let's examine why trading without a plan could put you at risk in addition to decreasing your chances of success. The Importance of a Trading Plan Any trader’s success comes from a well-written trading plan. Essential components such as objectives and entry/exit points are included. If you don't have it, you're just going to gamble rather than make wise decisions based on past performance and trends. Lack of Risk Management Inadequate risk management is one of the biggest challenges associated with trading without a plan. Because of how wildly volatile the Forex market can be, you run the risk of suffering significant losses if you don't use stop-loss orders or pre-plan your level of risk tolerance. Traders risk having their funds rapidly decreased if there is no framework in place...