Become a Forex Trader - ngulikenak.net

Forex is still the most profitable financial market with a huge daily turnover, approaching $7 trillion. Currency trading can be challenging as many external factors come into play. But this market can be very easy if you can follow a few things below! What does it take to become a forex trader? Let’s see!

Develop and Follow Trading System

Having a trading system is very important if you want to have a chance to make stable profits. The biggest enemy of every trader is emotion. When you have money in the market, you are much more prone to making silly and impulsive decisions that are likely to cost you.

That’s why it’s so important to develop a good strategy and a clear set of rules. First, your system should tell you under what conditions you should open a trade. In addition, you also have to determine other factors such as the maximum level of risk & return, and what action to take if your trading position does not match predictions.

Usually, successful traders avoid risking more than 2-10% of their total account balance on a single trading position. This is a good general level to take as it allows a reasonable percentage of profit while preserving your deposit for future opportunities in the event of a loss.

Use Stop Loss and Take Profit Levels!

Having a strong and reliable trading system/strategy is well and good, but if you don’t have clear guidelines for closing each trading position, a “winner” can easily turn into a big “loser” in no time.

That’s why it’s so important to sit down and think with a cool head what a realistic amount of profit and what percentage of loss you are willing to take. If you don’t put stop loss and take profit levels to close your position, you will most likely close the position with emotion.

Schedule Balance

With the Forex market open approximately 24/5, it’s easy to fall into the trap of sitting in front of a computer for hours on end for fear of missing out. You will almost certainly lose more by trying to trade every hour of the day.

When dealing with a market that is open around the clock, you have to understand that you can’t physically be there every time the opportunity presents itself. If you try, you will not only risk burning out, you will almost certainly be too tired to trade effectively, and may end up losing more money.

That’s why it’s so important to make a schedule for yourself. You should treat forex trading like a job with fixed hours. Get up at 8 am, for example. Spend an hour getting the latest news from the night before. Start active trading around 9:00 when European markets open and set a few hours to rest. Of course, this can be flexible. Determine according to your schedule.

Stress Management

It may seem trite, but this is what separates winners from losers in trading. It’s normal to feel a little insecure or worried when you realize you’ve lost money, but that’s why you have a strategy and rules that you must adhere to strictly no matter what.

Some of the things your trading system can’t prepare for is to make as much profit as you expect. Your trading system may not be as good as you expected, but if it’s still profitable cumulatively – don’t fix it. Be consistent first until your strategy is no longer profitable and no longer works in the market

Technical difficulties are another challenge that you as a trader will eventually have to face. Your computer could crash at the worst possible time, or your internet connection could drop just as you were about to open a position.

When that happens, don’t panic. When you get back online, make sure you don’t make any silly decisions. For example, if the signal has expired, do not open a position. As hard as you can, you should reboot your trading system and start over.

Well, that’s a brief discussion of what to prepare to become a forex trader.