Forex Trading Guide – 17 Key Factors for Success
asked:
1. Establish Stop Loss : Before making any forex trade what soever, decide before how much you’re willing to lose and you just follow that amount. Set a stop loss level before entering a trade and place it as soon as possible. Never alter your stop loss if your position is losing.
2. Let your profits Run : Never let your emotions govern a trade. Keep in mind why you are entering the market and of course you follow these reasons. You’ll be less emotional, you will be better. Do not turn your trading plan, move your stop loss as the market moves in your favor and let your profits run.
3. Do not influence them : You must have your own forex trading strategy and you will comply. If you are influenced by others, you change your mind so incessant, learn to ignore the outside once you have made your choice. You will always find someone who can give you a logical explanation to take a position opposed to yours.
4. Keep sizes and positions within acceptable limits : Forex Traders have a real success when they know that trading is a game of probabilities, and in long term if you stick to your strategies and you implement healthy strategies that you follow, it is likely that you will succeed. To be a successful trader, you will never take a position that could jeopardize substantial capital. In fact, you will find only very rarely win trader risk that more than 10% of its capital in a trade, and 10% is already extremely high. For example, if you deposit 25, 000 USD from your trading account, your maximum loss should be USD 2, 500, representing a maximum loss of 250 pips for a standard lot of 100,000 units (on a trade EUR / USD for example) . Generally, try to put more than 2 to 5% of your available capital.
5. Know your risk ratio Vs your earnings ratio : The ratio of benefit / minimum risk you should use is 2:1. For example, if you are trading long GBP / USD and you want to gain 50 pips, you should not risk more than 25 pips. Another example, you should never risk 40 pips to gain 15. If you do, you lose trades will ruin your chances of profits. The analysis of risk Vs profits is an extremely important for any forex trader.
Peter
1. Establish Stop Loss : Before making any forex trade what soever, decide before how much you’re willing to lose and you just follow that amount. Set a stop loss level before entering a trade and place it as soon as possible. Never alter your stop loss if your position is losing.
2. Let your profits Run : Never let your emotions govern a trade. Keep in mind why you are entering the market and of course you follow these reasons. You’ll be less emotional, you will be better. Do not turn your trading plan, move your stop loss as the market moves in your favor and let your profits run.
3. Do not influence them : You must have your own forex trading strategy and you will comply. If you are influenced by others, you change your mind so incessant, learn to ignore the outside once you have made your choice. You will always find someone who can give you a logical explanation to take a position opposed to yours.
4. Keep sizes and positions within acceptable limits : Forex Traders have a real success when they know that trading is a game of probabilities, and in long term if you stick to your strategies and you implement healthy strategies that you follow, it is likely that you will succeed. To be a successful trader, you will never take a position that could jeopardize substantial capital. In fact, you will find only very rarely win trader risk that more than 10% of its capital in a trade, and 10% is already extremely high. For example, if you deposit 25, 000 USD from your trading account, your maximum loss should be USD 2, 500, representing a maximum loss of 250 pips for a standard lot of 100,000 units (on a trade EUR / USD for example) . Generally, try to put more than 2 to 5% of your available capital.
5. Know your risk ratio Vs your earnings ratio : The ratio of benefit / minimum risk you should use is 2:1. For example, if you are trading long GBP / USD and you want to gain 50 pips, you should not risk more than 25 pips. Another example, you should never risk 40 pips to gain 15. If you do, you lose trades will ruin your chances of profits. The analysis of risk Vs profits is an extremely important for any forex trader.
Peter
Forex Trading Recommendations
