Forex Trading, can be very difficult. Especially when you are new, and have no idea what you are doing. Hopefully, you have read my previous 5 tips. The next 5 tips will benefit you just as much. Like I always say, these tips are NEEDED in the world of Forex Trading. It will be a constant reminder to ensure your success. This article is dedicated in helping fellow traders to be more careful when venturing into Forex Trading.
Wise Advice, Never Risk More than 2%-3% of Your Total Capital - Why? Because imagine if you risk more than that, how many loss can you endure in a row? Most unsuccessful traders will have a margin call just after 5 losses in a row. The difference between a successful and unsuccessful trader, even using the same trading plan, is their money management. You will last longer if your risk less.
Always Look at the Bigger Picture (I mean, time frame) - Before trading, always look into the bigger time frame; it will give you the overall trend. And this also shows you how long you should be in a trade. I hope that makes sense.
Pick the Best Time Frame for You - This is very important. Choose a time frame where you are comfortable how the market moves. Some traders like the action, so they pick smaller time frame and some have no time to constantly looking at the charts so they pick bigger ones. Find one that suits you and stick to it.
Set Your Stop Loss, Don't Even Think About Moving It - When you enter a trade, and you found out that the market is against you, deep down in your heart something tells you to move your stop loss further. Don't listen to that fool. Respect you stop loss, it is there to minimize you loss.
Don't Put another Trade in a Losing Trade (make sense?) - When you found your trade is losing, don't enter another trade to take revenge. It is hard enough to see a losing trade, why put another one? It is best to accept your loss and move away, tomorrow will be better. The last thing you want is a string of consecutive losses.
Be sure to always remember these tips. I do not want to see the percentage of failed new forex trader increase again.
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