7 Simple Steps To Get Success in Forex Trading
The following seven steps that I have written in relation to Forex trading success will assist reap huge returns in your forex trading and to avoid many losses that Forex traders incur.
- Consider trading as business, not sports betting
You need to take time and think about how you have been treating your business. You should be able to establish if you have been viewing your trading as business or an undertaking that is supposed to provide you with returns on investment. By doing so, you will be able to make out if the returns outweigh the costs that are your profit.
- Managing risks and rewarding efficiently by Position sizing
Position sizing is a strategy that enables you to establish the amount of money you need to place into a given trade. This strategy protects you from the catastrophic loss that might wipe away your investment and lead to the end of your business. Apart from losing money, catastrophic loss may lead to a nervous breakdown that you may not recover from. Therefore, to avoid catastrophic loss ensure that you size your position in the most accurate manner.
- Over-trading is a real problem for most traders and how to stop it
Over-trading will occur when you use all the funds to serve a trade that leaves you without any money in your account to service the next trade. This way, you will operate without funds for a period of time which will make you incur huge losses and might wipe away your business.
- Establish simple price action plans
Simplistic Price action strategies will enable you to keep your prices simple and achievable. Simple price action will make you an effective trader. This will require you to develop a chart that is indicator free and has only support and resistance area.
- Have a trading plan
There is an adage that says “you fail to plan, and you plan to fail” that is very true to any business especially in the forex trading. Forex trading is a business that requires planning. You plan should be written in stone but should be subject to re-evaluation.
- Use printed affirmations to keep your mindset on track, put them on your office wall or computer monitor.
It is important to write or print down some rules and regulations that you wish to follow and implement on a daily basis. This will assist you to avoid pitfalls that may lead you to impulse trading.
- Trade what you see and believe in, don’t doubt yourself or become a “hindsight trader”; meaning does not enter a trade due to regret or for no logical reason.
Don’t enter into any transaction unless you have given it due thought and are convinced that it will give you good returns. Don’t do it out of emotion such as a feeling that you left a good deal pass, or you failed and now you want to be in it just for the sake.
If you put into practice the above seven rules, you will never go wrong in Forex trade. Forex trading is a very lucrative venture that can earn you millions in returns.