Top forex trading takes a few things if you want consistent and lasting success in this market. This is especially true if you are just beginning your trading journey: Have a look a few things you ought to know:
Top 1: Know how to best apply your capital
I think for new traders on a somewhat of limited capital base forex is the best market for you to trade. The beautiful thing is it provides the most opportunity for traders with less than a large amount of capital.There are three different types of accounts for a diverse range of traders.
The standard account, provides large amounts of leverage for those who are well-capitalized. I would only recommend it to traders with at least $10,000 or more. For traders who don’t have that or less there are mini and micro accounts in which the pips values are much lower than usual. Therefore, giving a trader with a smaller amount of capital a chance to trade with out large sums of cashs lying around. Sure, the winnings might be smaller, but it’s process before profit. Understanding the game and how to manage your money is of the utmost importance especially if you want to stick around. Once you’ve mastered these aspects then you will finally profit.
Top 2: Know the best indicators for your strategy
This is a major one. You could have everything else going for you such as a good amount of capital and good mindset but without knowing how properly use the indicators you are shooting yourself in the foot. Know what indicators you should be using. Know why you are using them as well. Are you trying to determine the current trend direction? Are you trying to find a proper entry? What is your entry strategy?
For example, if you are looking to find and capture trends the best indicators you could use are the MACD or even something as simple as a moving average crossover. Need to know if there is enough volume to support trend continutation? Too easy, look to use solid indicators such as on balance volume or the TRIN. It is all defined by your strategy.
Another question to ask yourself: Is my strategy complete? Meaning does your strategy cover all ends such as entry strategy, entry conditions, money management and so on. Any well put together strategy has the answer to these question before any trading is done.
Top 3: Know what you want to accomplish from your trading
Trading is a business. In business it is wise to have goals to guide your actions by. By knowing having a solid idea of what you expect or plan to accomplish from your trading you put yourself a great position. You will have a reasons to not be discouraged by drawdowns or other things that might not go your way throughout the running of your trading business.
If you take time the time to figure out what these things mean to you you stand a much better chance of conquering the markets. If you can easily tell yourself the whats and whys of your trading you’re in much better position than many of your trading counterparts.