Why most new forex traders blow up their first account (and how to not be one of them)
Most new forex traders don't blow up their accounts because of bad strategy — they blow up because of bad risk management. Here are 3 things that separate traders who survive from traders who don't:
1. Risk a fixed % per trade, not a fixed dollar amount.
Risking 1-2% of your account per trade means a losing streak doesn't wipe you out. Risking a flat $100 on a $500 account will.
2. Always know your stop-loss before you enter.
If you don't know where you're wrong, you don't have a plan — you have a hope. Set your stop before you place the trade, not after it starts moving against you.
3. Leverage is a tool, not a strategy.
High leverage feels good when you're right and devastating when you're wrong. Position size based on your stop distance, not on how much margin your broker gives you.
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