Reduce biased opinion in real life trading
In regular retail business, you can easily create a strategy and spend your whole life following the ideas of it. In the case of Forex trading, things require a little bit of different effort. You need to plan wisely for the trades. Two aspects (money management and trading plan) must be utilized properly with the market condition. After opening a trade, you need to ensure proper control over it. That requires proper position sizing of the trades. Then the management of the trading money is also important. For the rookies, proper money management is undeniable. You cannot trade without proper care and manage the best trading performance. If you fail to adapt to the business, your fall is inevitable. You will shortly lose control over your trades. From there, big losses will eat your equity and then it will make you give up totally.
If you want to survive in the trading business, it is important to accept the trading processes. Without being too emotional try to reduce the tension in trading approaches. Always adapt to the market condition and your trading performance. Instead of changing the position sizing, learn from your mistakes and improve the control over your trades.
A huge number of traders lose money
The rookies must accept the reality of Forex trading. You will lose many trades in this marketplace. It is not deniable for a trader and you cannot work around the losing trades so easily. From this kind of experiences, the new traders get desperate for profits. This makes them biased of a position sizing of the trades. It even impacts the money management policy. Traders think of big lots to increase the profit potential. On the other hand, they also have poor control over the position sizing of the trades. With the market condition, rookies try to change their position sizing. The stop-loss and take-profit get changed according to the price movement. The only reason behind it is increasing the profit potential of a trade. If the position sizing of your trades is changing, it is foolish of you. There is no way you can ensure a profit potential from that trading plan.
So, to reduce the biases of your trading psychology, try to reduce the focus on the returns. Experts always suggest to use the demo account for Forex trading. Being a rookie trader, focus on learning at the initial stage.
Spend time on a proper trading plan
Without thinking of the returns from the trades, concentrate on the trading plans. In this case, you will also experience a biased trading mentality. Think of all the necessary elements of a trading plan. First the risk to reward ratio is necessary for the position sizing. Being desperate to make a profit, any trader can target for a 4R or 5R of profit. You cannot trade properly with a setup like 1:4 or 1:5. Instead of big profit target, you need to trade simply with a decent profit target. Thus, it would be easy to execute a trade. Moreover, for a short term trading approach, it is necessary to trade with a decent risk to reward ratio. As the rookies like to trade short term, it would help them a lot.
In case of the position sizing, you need to ensure strict management of the stop-loss and take-profit. Based on the risk to profit margin along with suitable supports and resistance the tools must be set. And never try to change the position sizing with those tools. It is not suitable to trade.
Risk exposures must be managed
The desperation of making profits is also increased when traders invest too much money into the trades. You need a simple risk management plan which can help with a consistent investment policy. Think of a 0.1% risk per trade strategy and then reduce the investment with 1:10 leverage. Then you will be safe as well as focused on the position sizing of the trades.