Trading entails taking a risk. You might lose everything occasionally. You are not alone if it happened to you. However, few people discuss their experiences because they feel embarrassed to do so in front of others.
However, one trader emailed me to tell me how he destroyed his Quotex account. This is what had taken place.
A story of how a trader wiped out his account.
Two screenshots were included in the email attachment. He appeared to have lost $4,000 in less than 12 hours. Only one of his subsequent five 1-minute trades had been successful.
Naturally, you feel sorry or unhappy for the person who lost that much money so quickly. When I told some merchants the story, they were shocked and asked how it could have happened.
A skilled trader can determine the cause by looking at the trades’ history. However, there are a few disastrous errors I want to forewarn you against.
Critical mistakes that may quickly destroy your Quotex account
Putting a large amount of money on a single trade
Putting a large amount of money on a single trade
There are instances when you can predict what will happen next very accurately. Call it luck, the sixth sense, or a gut instinct. You decide to put a significant amount of your account balance into the following trade because, regardless of the name, you trust your gut.
Such actions carry enormous risk. Your failure is severe if the trade is a loss.
And that’s exactly what the email-based trader accomplished. He had already lost more than a quarter of his initial investment just in the first trade.
Repeating this error will almost certainly cause your account balance to decrease. It almost occurred to our merchant. He used a third of the money that was left in the second trade. Fortunately for him, there was no winner or loser in the deal. He received $1000 back because the price was the same as the price upon his admission.
The motivation behind investing so much money in one deal is greed. People do not want to wait; they want quick money. The better variables are speed and size. You should use caution and readiness to resist impulsive behavior. You ought to implement a sensible capital management approach. Most traders won’t put more than 2% of their starting money at risk in a single deal.
Believing the Holy Grail of trading exists
Some traders use tips to make trades. There is nothing wrong with a little assistance, but the issues start when people start to regard the tips as their Holy Grail. The timing of the tips is often poor, making it difficult to profit from them. Therefore, the traders empty the accounts.
Remember! There is no such thing as the trading Holy Grail. The majority of traders that are successful will tell you this. There is no secret to becoming wealthy.
Protecting your capital and making more lucrative deals are the keys to trading success.
Using an effective money management approach, controlling your emotions, and recognizing when it is appropriate to enter a situation and when it is not will all contribute to your success. Losses also happen to professionals. The market’s course cannot be predicted with absolute confidence. However, losses can be minimized and recovered quickly with a sound strategy and adherence to the first-principle of protecting your account balance.
Fear is the feeling that gets in the way of accomplishment. People who are afraid feel insecure and doubtful about their choices. They therefore possess the knowledge necessary to enter a successful trade, but they continue to search for a secret tip from a trading expert.
Unfortunately, the market had begun to reverse while they were waiting for a tip, and they entered too late. Although the purported guru was unaffected, the person who trusted him gambled with his own money. Therefore, taking matters into your own hands can be a good option. to design your own trading strategy and put it into practice.
Trading in the opposite direction to the trend
Trading against the trend is another catastrophic error to avoid. The price direction is indicated by the trend. What good is trading in the opposite way, then? Your Quotex account might probably be wiped clean by it.
You can see an illustration of the trend below. What conclusions are there to be made?
- The tendency is upward. The trader can attempt to make a countertrend transaction in the hopes that the market will eventually turn around. Consider the scenario below, where it is obvious that the market is declining even without the use of a trendline. Of course, there are corrections along the road. Those actions can be interpreted as a trend reversal signal. However, it can take several time before a true reversal happens. As a result, trying to buck the trend can cost you a string of trades and deplete your trading account.
- The same price range, two similar transactions. Anger is what leads to this kind of error. At a specific price, you have made a trade. You suffered a loss when the market changed course. In any case, you believe the market is incorrect—not you—so you need to establish your innocence. When you place the order at the same price, you lose once more. The state of your emotions is unimportant to the market. Everyone has the same opportunity to profit from it. Whether you use it or not is entirely up to you.
Setting too short timeframes
A very alluring feature is provided by Quotex when trading financial derivatives. You have the option of selecting a very little time period. As a result, you might quickly earn a good income. You must, however, control your feelings. Short timeframes give you the opportunity to generate a quick profit. However, you might not have enough time to engage in reasonable thought prior to entering a new trading position.
I’m not trying to imply that trading one-minute positions is a poor idea. It might possibly yield you a greater return than a lengthy period of time. However, if you don’t have enough time to consider your options, you might lose.
If you make the same error several times, your account balance will be depleted. The trader from the email experienced this. During five straight 60-second trades, he lost $4,000 total.
That is all I have to say to you about this issue. Be not ashamed of your errors. Discover from them. And perhaps allow others to gain from them as well. Share your failure tales in the space provided below.
Use a free Quotex demo account to hone your abilities before making a genuine investment.
Q: What are some common trading errors that can destroy my Quotex account?
A: Some common trading errors that can lead to losses in your Quotex account include trading without a plan or strategy, overtrading, using too much leverage, failing to use stop-loss orders, and holding onto losing positions for too long.
Q: What is trading without a plan or strategy?
A: Trading without a plan or strategy means making trades without a clear idea of why you are entering or exiting a position, what your profit targets and stop-loss levels are, and what criteria you are using to identify potential trades. This can lead to impulsive and emotional trading decisions that are not based on a sound analysis of the market.
Q: What is overtrading?
A: Overtrading means making too many trades in a short period of time, often in an attempt to make up for losses or to capitalize on small market movements. Overtrading can lead to exhaustion, burnout, and poor decision-making.
Q: What is leverage?
A: Leverage is a way of amplifying the potential gains or losses of a trade by using borrowed funds to increase the size of your position. While leverage can increase your profits if the trade goes in your favor, it can also magnify your losses if the trade goes against you.
Q: What is a stop-loss order?
A: A stop-loss order is an order to close a position at a specified price in order to limit losses if the market moves against you. Stop-loss orders can help traders manage risk and avoid large losses.
Q: What is holding onto losing positions for too long?
A: Holding onto losing positions for too long means keeping a trade open even as it moves further and further into negative territory. This can be a result of a trader becoming emotionally attached to a position or hoping that the market will eventually turn in their favor. However, this can lead to significant losses and may cause a trader to miss out on other opportunities in the market.