There are three reasons why all trading failures happen. Yes, any account meltdown can be traced to one of three things. You're not going to like me for pointing them out (it's kind of like antibacterial liquid being poured into a cut-it hurts!)
Here are the three reasons:
1) Lack of focus
2) Lack of discipline
3) Being flat out lazy
"Lack of focus" means that you never learn one good trading system. You bounce around to the latest and greatest. Another form of lack of focus is not actually doing your trading or perhaps not using good stoploss values.
A lack of focus is deadly to your account balance. But there's worse . . .
With a lack of discipline, you're not making sure you have an edge in the market. You don't test your system. You don't stick to your trading rules after you've proven them. You take someone's word for something instead of testing it yourself. This is a biggie. But believe it or not, there's one even worse yet.
That's right, being flat out lazy. If you're like this, you trade with a broker known to be shady. You trade in such a manner that you make yourself an easy mark for the market maker sharks. (Don't for a moment think it's worse in forex than other markets. Money corrupts. Scoundrels are in all markets. Some of the worst have been in the futures markets. )
If you attempt day trading, you're lazy. You're looking for a quick buck. The brokers are going to take your money, and you can't do anything about it.
Don't make yourself an easy mark. Learn how to trade in such a way that you're safe. (Let me coin a new phrase, “defensive trading. ")
Do you want to learn more about how I trade? I have just completed my brand new guide, “Forex Trading - What Finally Worked For Me".
Download it free here: Forex Trading
Nathan Pennington is a forex trader and the author of Winning Forex Trading -THE Definitive Guide