The failure rate within the FX market is much higher than the success rate and this certainly is the reason why customers lose trading forex. There are a number of factors which grow the failure rate to such high levels. It can be estimated that out of every 100 new traders who enter the market, 96 of them fall short and only 4 gain profit long term.

The standard cause of losing capital is that traders jump highly early in a deal without having sufficient knowledge about it. A substantial section of traders enter the market without engaging in any practise on a demo account or practising technical or fundamental analysis.

Whenever a deal is initiated, a trader needs to decide the amount of leverage he will invest. The amount of capital he will gain or lose could be decided from the amount they bet per unit on a trade. It is usually not advisable to invest fairly low or extremely high leverage. If the investment is too high, the risk of cleaning out your account is also high. On the other hand if the investment is too low, the gain will be low and necessitate significantly more movement and higher risk to reach the target in the trade.

The strategy used to analyse the market much be appropriate. A trader should neither depend completely on fundamental analysis in the market nor should he follow the technical analysis alone. To get an idea of present and future state on the FX market a single should follow a mixture of both equally strategies.


One particular should not get emotionally involved mainly because deciding emotionally will hamper the logical thinking of a trader so you may be lead to building a premature buying or selling situation.

Greed is a very first thing which should be totally avoided by a trader given that it may aggravate to invest a higher amount during the deal by seeing the rising exchange price, but sometimes things go exactly opposite from expectations.

There is constantly an accurate time to enter and exit the market which needs to be determined correctly in order to be prosperous. Most traders possibly don't give much attention for the trends or signal or they don't have any knowledge about them. A deep study is required to know whether the market is in trend or range, before initiating a deal.

Apart from this one should have faith within the decisions he tends to make. Most traders get depressed once taking a wrong move and quit forex. All the above are the elementary aspects responsible for the failure and failure would be the answer into the question why do most people lose trading forex.