Easy guide for forex trading for beginners - page 2
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@fxnet your post will really be a great help for newbies a very useful for their everyday trading.Its well explained and easy to be absorbed for newbies.
Thank you gers. It's my pleasure and will definitely try to share with you even more forex related material!
Thanks for sharing valuable info
Hello everyone,
For all the newbies out there, our team of experts at FxNet have written down some useful tips that can improve your day-to-day trading. Please see below:
Trading without stop-loss is one of the most common and expensive mistakes of beginning traders. Always set a stop-loss to the amount you are willing to loose for every trade, otherwise you will see your account getting wiped out in a short period of time.
Not entering a take-profit can be just as dangerous as not entering a stop-loss. If you don’t enter profit targets and you just wait until it “feels” right to close the trade, then it can easily reverse and turn into a losing trade.
Depending on your trading style as well as your time of trading, you should always adjust the width of your SL accordingly. In general, during news trading your stop loss should be wide enough to absorb the market volatility and any spread widening that might occur. Trading news with stop loss of 10 pips is almost always a losing trade. During normal market conditions, you should use wider stop losses for longer timeframes and tighter for smaller timeframes.
Another common mistake for new traders is risking too much capital on a single trade. In general, you shouldn’t risk more than 5% of your capital on a single trade. This way, you would have to have 20 consecutive losses your account to be wiped out.
Choosing a risk-reward ratio depends on your trading style, but it should never fall below 1:1. A 1:1 ratio means your stop-loss and take-profit is of the same width (for example 20 pips SL and 20 pips TP). In this case, you would need at least half of your trades to be successful in order to break even. A 1:2 ratio means your take profit is twice of stop loss (for example SL 20 pips and TP 40 pips). In this case you would need only one third of your trades to be successful.
Don’t try to trade on a large amount of currency pairs. If you stick to a few pairs then you will better understand their characteristics by studying their history and you are more likely to predict their movement.
Being a successful trader simply means increasing your probability to win than to lose. Trading without some basic technical analysis or a trading system is not much different than gambling. There are many ways to increase the probability for a trade to be successful. Knowing even the most basic tools of technical analysis and being able to spot buying and selling signals can greatly enhance your trading experience as well as your profits.
Best of luck and kind regards,
The FXNET Team.Hello FXNET thanks for posting this.. Those tips are easy to absorb by traders.
You are very welcome Diana! Also, coming up, is an article describing several Trading Strategies and how they help traders become more successful!
As a STP Broker, FxNet has nothing to gain from trader losses and everything to gain from its traders success since our profit depends solely on volumes traded! For this reason, we send out these articles that can help you and all our clients trade better and turn failure into SUCCESS!
Best of luck!
You are very welcome Diana! Also, coming up, is an article describing several Trading Strategies and how they help traders become more successful!
As a STP Broker, FxNet has nothing to gain from trader losses and everything to gain from its traders success since our profit depends solely on volumes traded! For this reason, we send out these articles that can help you and all our clients trade better and turn failure into SUCCESS!
Best of luck!Thanks for the complement FxNet .I'll be waiting for your next post that would be helpful for us traders.
Thanks for sharing these useful guides/tips Fxnet!I like the one that states:trade with your logic and not by your emotions.We must set a trading plan then enter,manage,exit a trade using sound logic.We must not decide based on our emotions or hunches.We also must be realistic in our profit expectancy and not to try to overtrade in aim for bigger profits.
Anyway,I do really appreaciate your kind efforts in posting these useful guidelines.
Babypips School of Pipsology and Hermes Academy School of Forex are also provide good sources of Forex trading for beginners.
Babypips School of Pipsology and Hermes Academy School of Forex are also provide good sources of Forex trading for beginners.
You have a good suggestions those school are really helpful for traders specially for the newbies.
The profit will only depends on your trading experience.
From our experience, we will be aware of the dos and don'ts that can be use for the next trading. Our profit simply depends on us, on how we manage our trades, learn from our mistakes and most of all how we apply all the information we've got.