Having complete knowledge about Forex doesn’t ensure success as a trader. You have to get wet to learn to swim. Further, fitness and continuous practice could not be set aside to make a person, a good swimmer. Forex also warrants practice and persistence. Furthermore, you need a trading plan to be successful as an occasional visit to the pool helps you win nothing.

Stepping in as and when and trying your luck in Forex, would not give you any profit and you might end up as a loser. Even if you have gained some money, it would be a factor of luck. Instead of doing Forex as gambling, you could do it as a business, if you plan your actions perfectly.

1. Demo Trades

Avoid using your real currency before you gain confidence in the Forex market. Testing the waters with a demo trade is the right choice as it saves you from initial loss and probably from an early exit from the trade itself.

It helps you to know the basics of trading and lets you gain some confidence in the process. Demo trading for a period is good as it helps you assess your skill before moving on to live trade.

2. Be Fit

Emotional strength is necessary to survive in the Forex market as it can easily plunge you into a highly stressful vortex. You should choose the type of trading plan and style that best suits your personality.

Random decisions could result in failure which would be the result of anxiety, anger, lack of rest, or proper sleep. So, being fit emotionally is an important factor in becoming a successful trader.

3. Fix Your Limits

Allocating a certain percentage of your income to trade in the Forex market is a wise thing instead of risking all your income or borrowing in the hope of good returns. During trading, fixing a certain percentage of your allocated money to trade as an acceptable loss is one of the winning factors as it puts brakes on your over-enthusiasm and prevents further losses.

4. Profit Target

In a proper trading plan fixing your bearable loss, and fixing your target to earn a profit is also, a must to do on the list. Every businessman works for profit and a disciplined businessman always has certain goals to achieve. You as a Forex trader should also set your targets, which could be daily, weekly, monthly, or yearly targets. Generally, many traders fix the potential profit which should be at least three times the risk. Setting a percentage of your portfolio as a profit target and reassessing it regularly is an important factor in the Forex trading plan.

5. Be Informed

Forex is a 24-hour global market that is affected by various economic, political, and geological factors. A lot of online news feeds, journals, and business magazines are available which give you proper information on the adverse effects of these events on your trade. A well-informed trader always analyzes the situation before entering the trade. Analyzing the currency pairs and the happenings of another economic zone should have the topmost priority, which is your information is wealth.

6. Tune Your Trading System

Choose your trading system and program wisely. Mark your support and resistance levels and let the system alert you about the entry and exit signals set by you. Make your trading system a clear indicator with no distractions and use visual and auditory signals clearly.

7 Plan Your Entry

Traders generally buy signals, if the profit seems to be three times more than their risk. Today many systems are more reliable than humans as computers make decisions based on analysis and not on emotions. Today most people rely on systems and make good trades.

8. Plan Your Exit

Generally, traders pay more attention to buy signals than to sell signals. Fearing the loss, many traders don’t want to sell which would result in further loss. Even successful traders end up with more losing trades than winning trades. But with the practice of limiting losses and managing the money, they make a profit. Plan ahead your exit points, usually stop-loss points, and take profit points. Don’t let any emotional stress take over which could hamper your decision-making.

9. Have Your Own Journal

Keeping records of all your actions as a trader is a good practice which is a sign of a successful trader. In due course, it’ll act as a guide to make the right decisions.

10. Be a Critique

At the end of the day, thoroughly review your trade, and be a strict critique. It will help you to grow as a trader as everything percolates deep into your mind. And never get trapped in misconceptions.

regards



Judy