Just like every Job, Business or any other venture, Forex trading needs some tips and tricks in order to be successful. So in today’s lesson i have outlined 5 tips you need to do as a trader to get in track and become successful in Forex trading. They are probably tips you hear everyday but you ignore and that can be a big reason for your unpleasant results in trading.
1. Investing in knowledge No Matter what.
Sometimes you are one piece away of information. Anybody who wishes to get a piece of the large Forex profit cake must first seek to acquire the necessary knowledge and skill set. To do so, you don’t necessarily have to pay hefty training fees. There are a number of free Forex academies and Forums including this one. Where you can follow free of charge. Invest your time wisely, chose right channels to follow but test what you learn on Demo account first then go live.
2. Planning your trades, trading your plan.
Some people fail to understand that without a sound planning, may it be scalping or swing strategy, that strategy will be a failing strategy. There is a famous saying in the book of investment ”Plan your trade, trade your plan and repeat it again.”
Planning your Forex trading activities also involves keeping a record of your traders in a trading journal where you should include why you plan to get in, how you plan to get out, risk management and actual results of your actions.
3. Risk management
Although the Risk Disclosures with bit “Trading Forex Involves High Risk” may and do sound scary, by using proper Risk Management tools this risk can be reduced significantly. So, if you are planning to enter to the Forex market in 2019/20, get over your losing entries and become a winning trader this year you better learn the fundamentals of risk management. To start with, get over your greed and start using at least 3X risk reward ratio to stay positive at least in a 50/50 probability.
4. Small investment is no investment.
Especially the fact that there are many brokers now which offers deposits as low as $5 with 1:1000 leverage and so on and so forth, my recommendation for those of newbie traders is that invest wisely, when you deposit anything less than $500 you will no longer be able to apply proper risk management and if so you will get bored with the process and try to make risk more. That’s the point when the Ship sinks.
So make it part of your learning perspective, do not invest the money that you cannot support losing, control your greed and make sure to log your trading journal.
5. Choosing the right broker
You may have the necessary knowledge and skill set but if you end up with a wrong broker all your efforts may be lost, especially the fact that there are too many brokers going bust these days you must spend enough time to find the right broker.
The real challenge in choosing a broker comes when a trader does not know what he is looking for in a broker. So first thing first, determine what attributes you are looking for.
here are a number of elements I am looking for in a broker these are:
- Regulation. If your broker is not fully licensed and regulated by the US, UK, Swiss, Australian or Japanese regulatory bodies, you should be risk aware.
- Trading Platform: Trading platforms can often be hard to use. MT4, MT5 and cTrader are the most common platforms retail traders will use. But even then, you must check if your broker’s platform is stable, in another way does your platform go offline during news times or Asian session?
- Trading cost: What type of account does your broker provide? There are three types of accounts out there, these are Fixed Spread, Variable Spread and Commission accounts. It is up to you to decide which one is the most convenient one for your strategy.
- Leverage and Margin call: This becomes especially important if your account equity is lower than $10,000. So you don’t want to end up with full margin being used and being stuck in a margin call situation
- Personal Account Manager: Although the term personal account manager is not an old term, but it is relatively new in Forex industry. Every trader must have a personal account manager who can help him in case of any unexpected trouble.
Of course these points can go on and on depending on your personal criteria and you should be as specific as possible while choosing your broker.
Below is the recommendation of the broker i have been using for 3 years without issues.
I hope you have learned something from this short lesson folks. Don’t forget to share and leave a comment. Below
HAVE A GREAT WEEKEND