Three Questions to Ask Yourself Before Every Gold Trade

Cover introducing three questions to ask before every trade

Question one: are you calm? If angry, rushed or tired, skip the trade

Questions two and three: can you afford this loss, and do you understand why?

The best protection against bad decisions is a quick pause. Before every trade, we encourage members to ask themselves three questions. They take ten seconds, and they catch most of the mistakes beginners make. In this article we go through each question and explain what to do if the answer is no.

Are you calm?

Angry, rushed or tired? Skip it. A trade placed in a bad mood is a trade placed by someone who is not thinking clearly, and gold does not care how your day has gone. There will be another trade, and probably another one today. Members who learn to walk away when they are not calm save themselves from the costly revenge trades and rushed entries that cause most beginner losses.

Can you afford this loss?

Look at the stop-loss on the idea and work out what it means in money for your lot size. If the stop-loss gets hit, are you fine? Not happy, but fine? If the honest answer is no, the lot is too big. Reduce it until the potential loss is something you can shrug off. This single check keeps one bad trade from becoming a problem for your account or your life.

Do you understand why?

Every trade idea we send has a reason behind it. If you do not understand why we expect gold to move, ask us first. Understanding beats copying, because the trader who understands the idea knows what would change their mind, while the trader who copies is simply hoping. Over time, asking why on each trade is how you build the skill to see the levels yourself.

Key takeaways

Not calm? Skip the trade; there will be another
If the stop-loss would hurt, the lot size is too big
Ask why before placing; understanding beats copying

Common questions

What should you check before placing a trade?

That you are calm, that you can afford the loss if the stop-loss is hit, and that you understand the reason behind the trade.

How do you avoid emotional trading?

Pause before every trade. If you are angry, rushed or tired, skip it. A missed trade costs nothing, while an emotional one can.

Trade ideas with the levels already worked out

Join the free community and receive XAU/USD trade ideas with entry, stop-loss and take-profit, live training on Tuesdays and Thursdays, and support whenever you are stuck.

Join free on Telegram Open the calculators

Risk warning: This article is educational content, not personal investment advice. Gold is a leveraged, volatile instrument and you can lose some or all of your capital. Gold Trade Signals is not FCA regulated. Read the full risk warning.