The Step by Step Guide to Forex Trading

  1. Establish a Stop Loss
    Before entering any transaction, you must decide how much you’re willing to lose and stick to it. Establish a stop loss before entering the operation. Do not vary your stop loss if you’re in a losing negotiation.
  2. Let your profits increase
    Don’t get emotional over a negotiation. Know that you are going to win here and lose somewhere else. Keep in mind the reasons that led you to enter a negotiation. The less emotional you’re more likely you are to succeed. Stay true to your plan of action, move your stop loss as the market moves in your favor and let your profits increase.
  3. Don’t be influenced
    Stay consistent with your own plan. If you let others influence you, you will not stop changing your mind. Learn to isolate external sources once your decision is taken. There will always be someone to give you a logical reason to the contrary.
  4. Keep the dimensions of your position within your limits
    The negotiators who are successful know that to make profits must negotiate in the long term. The trading is a game of probabilities and as long as you keep your strategies, you increase your chances of success. Being a good negotiator, do not take a position that endangers your biggest part of your capital. In fact you rarely find negotiators successful who risk more than 10% of their account in a transaction. If you deposit 25,000 USD your maximum loss must be 2,500 USD on a margin of 5% and one operation minimum of 100,000 Euro which leads to number 2.5 or 250 pips (on a transaction EUR/USD) like maximum. Negotiate normally with a stop loss of less than 50 pips and a stop loss of a figure to the maximum or 100 pips of the transactions going of 100,000 to 200,000 basic units (the principal currency), you risk thus substantially less than 10% even 2-5% of the mobilizable deposit. You can wish to start small, then to increase the dimension of your transaction at the same time as your confidence increases.
  5. Compare your risk Vs your reward
     The minimum ratio to be used is 2:1, so you are doing a good job if you pass 50% of your transactions. If you are a long position, for example, and you wish to earn 30 pips, you should not risk more than 15 pips. You should never risk 30 pips to make 10 pips because if you did it would make a success of much more transactions than would not make you the unfruitful ones. But the unfruitful ones would ruin all your chances to make profits.  The analysis of your risks compared to your reward is essential in order to make interesting transactions.
  6. Be in possession of adequate capital
    We must never negotiate with money that you can not afford to lose. Always check the condition of your credit and ask yourself the following question: “If I lost 50% of my opening balance, could I still permetre the luxury to negotiate in 6 months?” You can not begin to negotiate only if the answer is “yes”. The mental independence is a key to success in trading. In other words, your freedom of trading should not be swayed by your fear of losing.
  7. Trend or neutrality
    Learn to analyze the market and ask yourself if it is a market-oriented or market neutral. In a market-oriented, follow the trend. In a neutral market, buy a “decline” and sell “up” as long as you make use of stop losses you control your risk.
  8. Do not fight against the trend
    Do not buy based on slopes or sell a case of “senior” in a market oriented. Do not fight against the trend, rather let the current carry you!
  9. Take the average? Certainly not!
    One of the most common mistakes made by negotiators, is to continually call to a losing position. Take the average is the death of negotiations in the short term because the fund is to preserve the most important thing, against a risk too jeopardizes success. In a transaction in the short term, if the strategy is good, the market should move in the right direction in a fairly short period of time. By cons if the strategy is bad, the negotiator must realize that it is better to overrule the loss the loss and move on. The pride did not really belong in a transaction in the short term, you should never add a losing position.
  10. Chase a bad idea
     That happens constantly. You notice a potential bargaining, however you decide to wait until tomorrow to see if it takes place. But when you see that everything happened as you planned, it may already be too late. Review your reasoning on the transaction and make sure that the initial reason why you’ve decided to trading is still in you, if not forget the transaction.
  11. Understand how the market functions
     It is important to understand that all information is already included in the cross-rates (except of course the latest information that the market has just taken and will not delay the issue). You need to know what clues arrive and especially familiar with the main among them. In addition, it is important to know what is anticipated by the market. Many publications market expectations regarding Principal indices.
  12. Trading - a game of probabilities
     It is impossible to have always right, it’s a fact. Good experienced negotiators know, this is a game of dice. You win some and lose others, the idea is to win more than one loses and not have everything, butter, silver butter and the smile of the crémière. It is important to understand that trading is a game of probabilities and strength to do things properly you’ll be in the lead. Learn from your mistakes because when you start to negotiate you can lose more than you win, then think about what you have done wrong. Try not to be nervous regarding the transactions. If you stick to your plan and learn, it is likely that profits outweigh your losses.
  13. Know  why you are in the negotiation
    Keep a diary of trading and write why you are entered in the transaction. Do not be impulsive and develop a plan to learn what strategies are good for you in the long run, and those who are not. If negotiate before or after taking a relaxation you do well, so do not hesitate.
  14. If the logic disappears, you disappear as well
    If the reason why you entered the world of the transaction no longer exists then you have no reason to stay. If you think you might be in a bad passes and nothing is more, it is preferable to leave, to weigh the pros and cons and finally take your decision.
  15. Have a maximum run
    If you have 4 or 5 transactions bad one after the other, take a break because something is wrong. Go out and resume your minds. Do not be afraid to take a break.
  16. Study
    Learn new ideas, stay up to date and do not negotiate the ideas of others. You always know why you are in the transaction.
  17. Have fun!
     Take pleasure in what you do, stay calm and stay as impassive as possible. You will succeed much better.