Why Most Traders End Up Losing

By: Johnathon Fox

99.99% of traders start out looking for the best system that will be their holy grail and make them all their millions. Not many people stop to tell these traders (they most likely would not listen anyway) that no matter just how fantastic their system is, they will still most likely come out losing.

I have taught a lot of people to trade Forex in recent years and in particular how to trade price action. Some traders I talk to have turned small accounts into large ones in a blink of an eye, and others have struggled around break even their whole career.

How can two people that both have the same teachings, using the exact same material have vastly different results? These traders are trading using the same charts, the same time frames and they both have the same use of leverage etc How can one kill the market and the other get killed?

The thing that separates these two traders is “The trader that regularly takes money from the markets think differently. These thoughts then turn into acting differently, which brings around different results”.

So the next question is how do these people think differently? The successful traders approach the markets from different point of view. These traders look at the market as a vehicle to make money and they realise the following:

- The market is neutral and is not there to play for or against the trader

- The market is not out to get anyone

- Price goes up or down simply because another trader bids it higher or lower, not because of news or external factors. News does not make price go higher. It may change a traders view of what should happen and create that trader to make a trade that then makes the market go higher/lower, but if something large happens in the news the only reason price moves is because someone trades using that news as part of their analysis to trade.

- Everyone will have losses and losing is an unavoidable part of doing business.

- The market is not there to make traders happy or feel better! Trading for the thrill of the game, or to boost a traders feelings is gambling.

How do These Thoughts Change Traders Actions?

Thoughts are so very powerful. Thinking the correct thoughts can bring about actions which flow into positive results. One of the main thoughts and emotions a trader feels regularly is fear. No matter how hard a trader tries to get rid of this feeling it remains. It is what the trader thinks whilst having this emotion that will determine the outcome.

When experiencing fear the amateur trader will begin to make a swag of trading errors. These include things such as:

- Playing with stops and targets whilst the trade is in play

- Taking profit to soon

- Letting trades run when the trader knows they should be closed

- Entering traders that are less than ideal because of the fear of missing out

These are only as few examples of where amateur traders get sucked into making decisions that bring about bad results.

If you want to start changing your results you need to start changing the way you think about the markets and then the actions that you take. Instead of being crippled by the fear, take a breath and think about what a professional trader would do.

The professional trader has their plan and sticks to their plan at all times. The professional realises when fear is creeping in, and makes it their number one priory to stick to the plan no matter what they are feeling.


Above all else you need to realise the markets are simply a vehicle to make money. The markets are not out to get you and they are completely neutral. When fear is creeping in take stock and stick to the plan.
Plan the trade and trade the plan!

Johnathon Fox is a professional Forex and Futures trader who also tutors and mentors aspiring traders worldwide. Johnathon teaches a very useful method of Price Action trading and has a knack for helping traders become consistently profitable.

1 User Reviews
  • Anubavsheik

    Yes, it is the mindset that makes a hell of a difference and unless we don’t stop believing in those miracles or holy grails as you mention, it is a likely scenario of failures, but it also much be said that that alone cannot be 99%, as scam brokers play equally big role in our losses especially desk dealers. I have suffered a lot, but thankfully I got my action correct with joining OctaFX, as it is a true and award winning ECN Brokerage Company.

    Anubavsheik November, 2014

Registration is required to ensure the security of our users. Login via Facebook to share your comment with your friends, or register for DailyForex to post comments quickly and safely whenever you have something to say.

Log in | Create a DailyForex.com Account Now