Forex technical risks
In addition to the well-known risk of exchange rate fluctuations, there are also a number of other dangers in the Forex market,
which, if they arise, can lead to the complete loss of your deposit.
However, while exchange rate risk is taken into account first and foremost, other potential risks are not always considered by beginning traders.
Technical risks in Forex arise for a number of reasons beyond the trader's control, and to prevent them, a number of preliminary actions must be taken in advance.
By spending just a few minutes, you can save your deposit from being completely lost.
These could be due to equipment malfunctions on the trader's end, or problems arising in the work of the broker providing forex trading services.
So let's move on to a detailed review of technical risks in Forex.
1. Orders not triggered – as a result of this situation, you may not only lose profit if a pending order fails to trigger, but also completely lose your deposit if a stop-loss is not triggered.
You can prove your case only with a saved screenshot of the trading terminal screen. This process takes no more than a minute and can save hundreds of dollars.
This also includes stops not being triggered during a gap, or rather, triggered belatedly only after the first quote appears. Correcting this situation is virtually impossible; it's easier to try to prevent it by not trading when the probability of a price gap is high.
2. The trader's terminal freezes – this also happens quite often. You can't close an unsuccessful order, and you have no idea what's happening with your open position.
For some reason, situations like this always happen at the most inopportune moment.
A solution might be to reboot the computer, restart the trading terminal itself, or use alternative hardware. For example, I bought an inexpensive netbook for this purpose—it only cost $200, and I don't have to worry about system crashes.
Also, don’t forget about such options as a web terminal and a mobile terminal on your phone.
If the situation does not require an immediate solution, you can simply reboot your computer or restart the frozen terminal.
3. Hardware failure – this could be a simple glitch in your operating system or a power outage.
In the first case, you can use the option described above (duplicate equipment), in the second, use uninterruptible power supplies, such a source costs only 40-50 dollars, and allows autonomous operation without electricity for 10-15 minutes.
4. Requotes and slippage - in the first case, you are denied permission to open a position; in the second, the position is opened, but at a completely different price, usually no longer favorable to you.
To avoid such situations, it's important to work only with reputable brokers from the start. This will save you stress and increase your profits.
Preliminary risk management allows for almost 100% prevention of technical Forex risks, and as we know, it is better to avoid mistakes in the first place than to deal with them later.
