There are some other ways to avoid typical pitfalls and start making money in your forex trading. These six step are few of them, start your change today and be a better forex trader.
- Trade pairs, not currencies - Like any relationship, you have to know both sides. Success or failure in forex trading depends upon being right about both currencies and how they impact one another, not just one.
- Umambitious trading - Many new traders will place very tight orders in order to take very small profits. this is not a sustainable approach because although you may be profitable in the short run (if you are lucky), you risk losing in the longer term as you have recover the difference between the bid and ask price before you can make any profit and this is much more difficult when you make small trades than when you make larger ones.
- No strategy - The aim of making money is not trading strategy. A strategy is your map for how you plan to make money. Your strategy details the approach you are going to take, which currencies you are going to trade and how you will manage your risk. without a strategy, you may become one of the 90% of new traders that lose their money.
- Trade on the news - Most of the really big market moves occur around news time. trading volume is high and the moves are significant; this means there is no better time to trade than when news is released. This is when the big players adjust their positions and prices change resulting in a serious currency flow.
- Don't act smart - The most successful traders keep their trading simple. They don't analyze all day or research historical trends and track web logs and their result are excellent.
- Emotional Trading - Without that all-important strategy, you're trades essentially are thoughts only and thoughts are emotions and a very poor foundation for trading. When most of us are upset and emotional, we don't tend to make the wisest decisions. Don't let your emotions sway you.
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