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A Guide to Winning Big in Forex Trading

While the recent trade war has had a deep impact on the supply chains across the globe, this has provided the Forex traders with a myriad of opportunities. Though you will not be able to become a billionaire all of a sudden, you will be able to the competition in the market to help your trade. But how will you do it? Well, there are several things that you need to be assured to profit in Forex trading. Here are a few tips that you can use to master in the Forex trading:

Finding the Best Way to Start

The most important thing that you need to get started with Forex trading is money. If you do not have the money needed then you will not be able to start your journey in the Forex market. Thus, arranging the money and getting started is obviously the first step in Forex trading. Nevertheless, it is not easy for everyone to round up the cash to start trading. Well, in that case, there are only two choices that they are left with. They can either start making small investments and go up the market from what they earn or they can take a loan from others to start trading. But you will have to understand that the second option has its own fair share of risks.

There is another trick you can use if you are above sixty and own a home. Of course, you can use the trick of a reverse mortgage to get the money you need to start trading. In this way, you will be able to make use of the equity that your home holds without the need to pay back the loan till the end of your life. As a result, you will have the money you want without the need to pay the loan.

But you need to remember at all times that the money that you are getting from a reverse mortgage is not free. Of course, it has to be returned eventually since it is a loan. So, it comes with some sort of risk factors. However, if you are completely aware of what you are doing then you will not have to worry about the reverse mortgage.
Above all this, you can also seek the help of sponsors as well as investors to team up with you to benefit from the trade. In this case, you need to have a proven strategy for trading which will provide you with the best results.

A Proven Strategy is Must

When you are trading in the Forex market, you will need a proven strategy or a proper plan of action. Trading in the Forex market may seem like gambling to many. But you need to remember at all times that the Forex market traders do not go into unnecessary trades. They analyse every byte of data available, research the market properly, review different trading models and trade as per their risk appetite. These are a few things that you need to remember vividly if you want to become a winner in the Forex market.

The efficient traders are those who do not worry about the frequency of their trades. But they always make sure that they achieve utmost success from the trades that they enter. They do not try to get success from every trade but they only focus on those from which they can get what they aim for.

So, how will you start trading in the Forex market? As said earlier, the very first thing that you need to do is to carry out proper market research. You can study the market properly, understand the trends by reviewing different models and simulated trades to develop your own trading strategy.

You can also take the help of “Price Action Trading” strategy to trade in the Forex trade. This strategy has been around for a long time in the market. It requires you to study the Forex pricing chart and understand the trends of Forex pricing. It is one of the proven strategies that traders favour since it is simple yet efficient. Then again, you can always develop your own strategy to excel in Forex trading.

Utilise the Time Properly

While most of the people think that trading for the shorter time frames is always best, you must focus for longer time frames when you are beginning as a trader in the Forex market. You may not be able to make use of the high opportunities of the short trades but engaging on the long trades will help you to have a proper understanding of the market. So, do not get into the short trades in the beginning. Improve your understanding with the long trades and become a winner.

Analyse the Market in the Right Way

One of the mistakes that most of the people make is to watch the hourly charts to modify their trade when they are trading on the day to day basis. This practice can compel you to make wrong decisions since you are not trading on an hourly basis. As a result, you need to get rid of this habit. View the charts only before the market opens and after the market closes to understand the trends as well as to make a proper analysis.

Trading in the Forex market requires you to be smart as well as efficient. So, have a look at the tips mentioned above, follow them earnestly and achieve big success in the Forex market.

Six Steps to Make Money in Forex Market

More than $4 trillion dollar worth of currency is traded every day in foreign exchange market. This is the largest financial market in the world and it is not hard to make money in forex if traders have the essential experience and a good forex trading strategy. Experience comes through time and a good trading strategy emerges from the mistakes, trial and errors, perseverance and curiosity of the trader.

According to a Bloomberg study and a research conducted by National Futures Association (NFA), more than 80% of the retail forex traders lose money. This suggests that trading in leveraged forex market is not for everyone and self-improvement is necessary.

In theory, the concept of forex trading is not very complicated, since there is only one simple decision that trader has to make; whether to buy or sell a currency pair. If the trader believes that EURUSD will go up and buys and EURUSD moves higher, a profit is made.

On the other hand if EURUSD declines, the trader suffers a loss. But in practice, forex trading is not that plain. Human psychology comes into play and meddles with the trader’s decision. Even the best-devised trading strategies and experienced forex traders are vulnerable to the tricky games of human emotions. In this article, I am going to present some useful approaches that are going to improve your odds of making profit in forex market.

Following a Trading Plan

Investors who make a living from forex trading has developed a daily trading plan and this is by far the first step to take if you are convinced that trading forex market is what you want to do in the long run. Following a trading plan with persistent discipline and patient is going to flourish sound trading habits for you. So what are those habits? Keep reading…

Create a Trading Plan

Learn Before Going Live

Forex is very easy to start with. You register with a forex broker, submit the required documents, fund your account and you are good to start trading. This whole process may take between one to three business days. However, just because forex is easy to get into, it doesn’t mean that becoming a profitable forex trader is likewise.

Well, of course, you could get lucky and make money in forex from your first trades however it is for sure that you are going to blow up your trading account eventually if you don’t train yourself. Learning is an ongoing process as the market dynamics could change frequently and traders have to be prepared to accommodate to new market conditions. A successful trader is obliged to know everything that affects the forex pairs, including economic data, central bank policies, technical analysis, political and geopolitical developments.

A significant portion of training comes through trading live account. Since you are trading with your hard-earned money and manipulative emotions are included, you are to get the most efficient and genuine lessons and experience by trading live. However, applying your trading strategy on a practice account before going live is still very helpful and saves you from the risk of losing real money in the case the trading strategy fails.

My conviction is that you have to apply a strategy on a demo account at least for three months with at least fifty executed trades in order to be able to conclude whether it is a profitable or losing one. A good alternative to practice account is a nano account (named cent account on some brokers) where you can trade as low as 10 contracts, compared to standard accounts where the minimum transaction size is 1000 contracts.

Find a Reliable Forex Broker

The training and experience are two essential factors on the way to make money in forex. Say, you have been trading forex market for several years, you have the enough experience. Besides, you are very well synched with the markets. You are following the economic calendar, political developments and central bank policies in a timely manner.

However, the forex broker that you are working with is a not regulated and reliable one. You are not sure if you will be able to get it into your bank account when you profit on your trades. Does it matter if you have ten years of trading experience and discovered the holy grail of forex market but you can’t withdraw your profit to your bank account or the broker doesn’t allow you profit by applying shady practices on its trading platform?

Therefore traders should only open forex trading account with a broker that is regulated by a reputable regulator such as FCA in the UK, ASIC in Australia, NFA and CFTC in the US, CySEC in Cyprus and FINMA in Switzerland. All those regulators impose strict standards and oversee them to ensure the safety of client deposits and the overall credibility of a forex broker. Please check my list for the reviews and ranking of forex brokers from all around the world.

Find a Reliable Forex Broker

Choose a Trading Style That Fits

Every trader has their own trading style and strategy that is suitable to their personality, experience and knowledge. Some traders like trading based on technical analysis and some others on fundamental analysis. Some traders prefer using multiple technical indicators that ara offered on the trading platform whereas only one indicator could be good enough to see where the market will move next for some other traders.

How about me? I can say that I am a trader who predominantly utilizes fundamental analysis for predicting the markets with keeping an eye open on technical indicators and chart formations. I strongly believe that major moves are triggered by fundamental differences between two currencies such as divergence of monetary policy, economic growth, employment and inflation outlook. However, technical factors such as support and resistance may shape the short term or intraday price action thus should never be ignored.

Establish Realistic Goals

Too many eager traders join to the forex market with a fantasy of making thousands of dollars every month with a limited amount of capital. Do you think that this is an objective and feasible goal? This market is the wildest that you could ever see and makes a lot of fake moves such as bear traps and bull traps. Thus setting hundreds of pips as daily target or ten thousand dollars per month with a starting capital of few hundred dollars are not realistic.

Be Patient

Beginner forex traders are inclined to lose their nerve fast if the trade that they executed does not go their way immediately. On the other hand if the trade earns little profit, they get excited to pull the plug early and get out of the market with a small profit. Patience is a great personality trait and this could not be proven more correct than when trading forex. Emotions and human psychology is the key here and every trader should remember that all human beings are exposed to the same feelings.

I also used to fear for being on the wrong side of the market, blowing up my trading account, getting margin call, etc during early days of my trading career. After all, forex trading is about learning yourself, making mistakes and improving yourself on the lessons you get from your losing trades. This whole process takes time and you have to be patient enough to endure the losses, fears and frustrations in order to be able to bring out the forex trader within yourself.

Risk Warning: Trading Forex and CFDs involves significant risk and can result in the loss of your invested capital. You should not invest more than you can afford to lose and should ensure that you fully understand the risks involved. Trading leveraged products may not be suitable for all investors. Before trading, please take into consideration your level of experience, investment objectives and seek independent financial advice if necessary.