Sadly, losing money in the Forex market is part of the process of becoming good at it. It would be an extremely rare trader who never lost a trade in a week’s or even a day’s exchanges. The volatility of the market and the instability based on global events, makes it very hard to predict. As such, even if you sat by your computer 24 hours a day and watched every single news channel on the planet, you’d stilll never react perfectly and avoid any losses.
There are some essential tips to minimize losing in Forex trading.
1. Accept that you will experience losses or drawdowns
Losses are inevitable and once you understand that and take it as part of the process, you will behave more maturely and find ways to minimize them. Egotistical traders who become too confident in their wins stand to lose more when their turn comes to lose a trade because they take on too much risk.
2. Don’t pour more money into losing positions
Once you realize you are in a losing position, trigger your stop and cut your losses. Only your pride doesn’t want failing trades to die since then you are locking the fact of a loss. Use the loss to understand what went wrong so that you can make a better decision next trade.
3. Use stops or tell your broker to close losing positions
Give your broker instructions, or enter stop losses to automatically close your losing positions. There is never a good reason to allow losses to run and put you in a difficult position. Good brokers can even execute a margin call on your account that put a stop to your losses at a pre-designated point (percent or actual number).
What is a margin call?
When opening a forex trading position, you create a collateral deposit, a margin, a sum which will be set aside against your account. On a $20,000 account, your margin might be set at $5000. You will use the $15,000 to trade and if your losses reach that full 15k amount, your position will be instantly closed so as to protect you from losing more of your remaining account balance. This margin prevents your account from going negative which, you will be required to pay by most brokages.
4. Start out forex trading with caution
When you are inexperienced, trading along with the market trends is the safest. Novice traders should avoid trying to predict the up or down swings of spot prices. Even more experienced traders can suffer their biggest losses when guessing at forex market movements. Ride the wave of established trends that are already clear, and exit trading when they begin to take a negative turn or even better when you have a couple pips of profit locked in.
5. Don’t fall in love with your trades
When you lose, accept your loses and exit. Emotional loyalty is just a way of not wanting to admit being wrong. Forex trading is a volatile and mostly unpredictable market. Positions change direction constantly. Forex is not a place for emotional trading; celebrate the successes but turn your back quickly on the failures.
6. Get rid of the ‘get rich quick’ mindset
Disregard stories of 10 minute billionaires. To succeed with Forex trading and lessen the pain of your inevitable losses, you need to treat it as a business. Plan to be in business long term rather than thinking that you will make big bucks overnight. Entering Forex trading sword drawn, expecting to conquer, will see you lose money more rapidly than taking a methodical, realistic and business-like approach.
7. Accept responsibility for all loses
Unless you want to rely on the mostly unreliable advice from strangers and potential scam artists, the first thing to learn is to minimize your losses in Forex trading. Use every loss as a tool to become more honest and to build your knowledge. This can only be done by taking 100% responsibility for when things go against you, just as you may accept being a genius when you succeed. 
Once you learn to accept responsibility, you won’t be tempted to adopt a victim complex when the market doesn’t go your way. Simply dust yourself off, learn the lesson of the day, get wiser and re-apply yourself to being a better forex trader in the next position you open.
