%20market%20is%20the%20largest%20and%20most%20liquid%20financial%20market%20in%20the%20world.%20The%20average%20daily%20trade%20in%20the%20global%20FOREX%20markets%20exceeds%20US$1.9%20trillion%20(Source:%20the%20Triennial%20Central%20Bank%20Survey%20of%20Foreign%20Exchange%20and%20Derivatives%20Market%20Activity%20conducted%20by%20the%20Bank%20for%20International%20Settlements%20(BIS)%20in%20April%202004,...){kind=link}
Sedco Forex International Inc - Automated Trading Vs Manual Trading
Sedco Forex International Inc
Sedco Forex International IncThe Foreign currency Exchange (FOREX) market is the largest and most liquid financial market in the world. The average daily trade in the global FOREX markets exceeds US$1.9 trillion (Source: the Triennial Central Bank Survey of Foreign Exchange and Derivatives Market Activity conducted by the Bank for International Settlements (BIS) in April 2004, and published in March 2005). These huge funds are traded by governments, banks, and large institutions. For comparison, the biggest stock market on the Earth - NYSE Group (The New York Stock Exchange), has a daily trading volume of approximately $86.8 billion (Source: NYSE Group, Inc. 2006). FOREX has a 18.4% average growth rate per year since 1989. It offers trading 24 hours a day, five days a week, non-stop over Internet. This kind of massively liquid and long uninterrupted trading hours mean that under normal conditions there is no problem entering or exiting a trade. Sedco Forex International Inc
But, in this huge market, as the story goes, at least 90% of new FOREX traders lose all their money within their first 3 months of trading. Why? Most losing traders who inquire about FOREX trading are quite intelligent, they just lack the right tools, the "Secret Weapons" to win. They are not beaten by other traders, they simply are beaten by themselves, by humans' weaknesses.
Talking about humans' weaknesses, let us list some as follows:
1. What is the first big weakness of human beings? if I say it should be "greed", is there anybody will disagree? Many times we have got 1% profit, but we feel it is not fat enough. We want more, 2% or 3% will be better. While the profit really goes to 3%, we will think how about 10%? Not enough forever. But the market is so volatile, especially in Forex market, we often encounter this depressive situation: profit turns into negative from positive. and this kind of depression happens again and again. Sedco Forex International Inc
2. Fear. All people have fear. In Forex trading, currency rate is easily jumping or dropping hundreds of pips. Few of people can make sure how the market will go. In Forex market, people all use leverage to trade, from 50:1 to 500:1, leverage will enlarge the profit or loss from 50 times to 500 times. Leverage is the wonderful feature of Forex, and it lead fear into people's heart too. If the market goes against people, big drawdown comes, their fear comes too. Is there anybody not scary to lose money? Under the pressure of fear, people easily and often make wrong decisions, stop loss too early, then regret soon.
3. Lack of confidence. Seems better than fear, huh? But it is still not a good thing. Many times human traders are so happy once they see a little bit profit in their accounts. They are worrying what if the profit turns into loss? People always take a tiny profit and run, then regret while they see the market goes further and further along the right track. If they were confident, they would have made ten times or even a hundred times of profit.
4. Hesitation. Not only newbies, but also old-hands easily hesitate to act in Forex market. You've probably heard the saying "past performance does not predict future performance". Even a very experienced trader who has made many successful trades in his/her history, while he or she is facing a new situation, needs thinking twice before making a so simple decision: Buy or Sell? For new traders or amateurs, they need longer time to think, and this kind of hesitation always leads them to confusion and missing the best and fleeting chance.
5. Weariness. How many people can keep working for 24 hours? No sleep, no rest? How about 48 hours, 72 hours, etc? Even an iron man can not use his eyes watching computer monitor, his brain thinking fast changing questions and his hands calculating complex formulas, day and night, 24 hours a day, 6 days a week, non stop. Especially, no mistakes allowed!
Nobody can!
None!
No doubt! Sedco Forex International Inc
Sedco Forex International Inc - Automated Trading Vs Manual Trading
By: Forex Expert