10 Steps to Make FX Trading with Crab Trader Method a Pillar of Your Income | Step 4 Measures When Losses Are Large

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Crab Trader. Started YouTube Live on January 15, 2018. Streams all 12 hours of his own trading from daytime to midnight in real time. Under the themes “Earn in front of you” and “You earn in front of you as well,” he shares all entries, orders and stop orders every day.

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※This article is a reprint/reedit from FX攻略.com September 2019 issue. Please note that the market information written in the text may differ from the current market conditions.

Lowering the lot size nearly solves the problem

Almost everyone who loses in FX loses a large amount in a single trade. I have never heard of cases where people continually lose a small amount bit by bit and end up losing a huge sum as a result.

In other words, reducing the loss per trade reduces the risk of being forced out of the market.

To avoid big losses, the most effective measure is to reduce the trading lot size. This alone is such a powerful remedy that it can solve many FX-related problems. It preserves your account margin and also reduces losses on losing trades.

Furthermore, there is a large mental benefit. When the lot size and the mental state do not mesh, even when there is a bit of profit, you may take quick profits or fear unrealized losses more than necessary, which hampers normal trading and tends to lead to small profits and large losses.

That said, trading always with very small lots won’t make you a lot of money. Eventually, there will be days to increase the lot size, but doing so too early can cause problems.

One way to think about it is to increase the lot size as your account balance grows. Conversely, increasing the lot size when the account balance is shrinking is a dangerous trade aimed at making up losses, and this should definitely be avoided.