Forex Trading Tips – Prepare Yourself Well Or Lose Everything

There are iron rules in each business and ignoring these rules will make the players kicked out quickly from the game, this is also applied in forex trading. Apply these forex trading tips in your trading career to make steady profits, keep your account save, and play by the rules:

1. Never Make An Entry Without Doing Analysis First

There area always times when you will stumble upon something that looks very promising, perhaps from news or trends. These ‘hunch’ may bring you profits once or twice, but it just coincidence, you will never survive in forex trading if all that you got is ‘hunch’ instead of proper analysis and logical decisions.

This has happened to the majority of the traders when they started; they manage to make a profit by speculating, thinking that they already master the secrets of forex trading, and start giving forex trading tips to their acquaintances. This attitude is identical to a gambler in a casino: throw the dice and pray. You’ll be thrown out from the game in no time with this kind of attitude.

2. Learn Step by Step

Foreign exchange has many factors and elements; it is purely not possible to grasp it instantaneously. If you are a novice, do not deposit USD10,000 in your new account and have various tests with it. Trading currency is similar to gambling; when someone lose, there are always a winner at the other side. These winners will finish your USD10,000 in no time and by reading this forex trading tips you have learned to avoid it.

The best ways to go is take it slow. Start with a practice/dummy account while learning. It is possible to test a variety of methods, currency pairs, robots, and signals there without concerns. If you have discovered a system that is effective, you can proceed to a mini account for further test. Nevertheless, if you have confidence in your system, go ahead and open a live account.

By “system that works”, I refer to a system that can generate profits on regular basis at the end of the month without you have to spend your entire time maintaining your open positions. If you have confidence in it, learn to control your emotion and allow it to do the work.

3. Utilize Trusted Forex Trading Platform/Forex Broker

No matter how good your system is, trading in a poor quality platform will ruin your opportunity to gain profits. Usually, you will get free trading platform from your broker; these are what you need to look in your trading platform/forex broker:

– Support all currency pairs that you interested in. At the minimum it must support popular currency pair like EUR/USD, GBP/USD, and USD/JPY.

– Allow you to put take profit and stop loss order; this is very important risk management method.

– Provide charting feature, news feed, advices, and research material; to make it short: all that you need to make proper analysis. If possible, a daily forex trading tips can be beneficial as well.

– Customer support available. If possible, get the one that provide 24 hours support so you can contact them any time when you get problems.

– Currency trading is a global business, so it is great if your broker take deposit in multiple currencies.

– Simple procedures applied in their services, including withdrawal.

4. Figure out how to Use Stop Loss and Take Profit Order

Stop Loss and Take Profit is orders that you put to close your position at certain price. Instance: you buy GBP at 1.678; then you place Stop Loss order at 1.648 to limit your loss by 30 pips. You also put Take Profit order at 1.708 which means you will close it when you get 30 pips profit.

This is important so that you can prevent your emotion to take part on the “close decision” and screw it up. If the market is move against you, you won’t close the position since you are hoping the market to swing back to your side, thus turn potential loss into profits. In most cases, this will only bring you more losses. This is very important since it is the cause of many traders falls. If you don’t remember everything that I mentioned in this forex trading tips, remember this: emotion is only going to make your trader career short.

Other possibility: the market moves in your favor and you start to gain profits, but you still hold it because you want even larger profits. You can ever predict when the market will moves against you and when it really does, it will be already too late. In both scenarios, greed is the one in movement. But when logic dictates, you can control greed.

Main point here: you should not rush everything when you learn or trade forex. Take your time to learn the rules, test, practice, analyze, and read several forex trading tips for the day. However, I don’t recommend you to do it by yourself since it can be long and painful process.