Closing Out a Forex Market Trade

Market trading either ends with a profit or a loss. Occasionally, trades will end flat, meaning they are without a gain or a loss because a traders exits at the same price at which he entered. It is difficult to foresee when the right time is to exit a trade. A trader can experience remorse if he gets out of a trade too soon and watches the market continue to move in the direction of his trade.

However, a well-thought out plan will help any trader avoid drastic exits or entrances based on the excitement of the moment. Staying with a plan will assist a trader avoid too much risk. It is fulfilling to take a profit based on the trade plan. It is tempting to get greedy. But no trader ever captures one hundred percent of any price movement.

Once a trade has been exited, the market may lure one back in. It is vital to treat each trade independently, without the emotions or regrets of the past. A trader must continue to assess the market objectively in hopes of making each trade profitable.

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There are times when a trade is cut short with a stop-loss order. This is always a frustrating yet necessary part of trading in the forex market. If the market doesn’t move as anticipated, the trader must determine where to exit a trade. Stop-losses, although never ideal, are a valuable tool for a trader. They will hinder trading losses from developing into devastating ones.