5 Keys to Avoiding Your Forex Trading Failures
Did you know that there are at least five things you must know in order to maximize the profit potential in forex trading? Without knowing the five things that will be explained below, it is impossible for you to be a profitable trader. Let alone maximize profit potential, even being consistent will be difficult for you to achieve.
These five keys are actually the very basic things a trader needs to know. Too bad the majority of traders just ignore these five keys in pursuit of “instant” profits. Though there is no instant in the world of trading. Like a business that promises extraordinary opportunities, trading also needs perseverance and accuracy.
Will you know the five key things? If your answer is “yes”, please read this article completely.
Key # 1: Choose the right instrument
The trading world offers many instruments or commodities that you can trade. Starting from the major currency (the world’s major currency), commodities such as gold and silver, to the stock index.
Each instrument has different characteristics. Some are very fast, some are calm. Well, you have to choose which one suits your character. If you are a person who likes challenges, adrenaline junkie or whatever the name suggests, you can choose instruments that have high volatility, meaning that the up and down movements that occur are very fast and wide / far. For example the pound sterling (GBP / USD), gold, or maybe the HangSeng stock index.
But if you are a person who has a calm character, or the term child now: woles, you can choose instruments that are also calmer in movement. For example the currency pair USD / CHF, EUR / GBP, or maybe the Kospi stock index.
Key # 2: Choose the right analysis method
If you do a search on Google and type for example: “trading analysis system”, there will be lots of internet sites that inform analysis methods.
All you have to understand is that you have to choose the analytical method that is right for you. In this case, “right” means matching the character you talked about earlier. Is it aggressive? An analytical method that works well for someone is not necessarily suitable for others. The analogy is, if for example you don’t like speeding, you would prefer a duck motorbike rather than a sports motorbike right?
The second, must also match the character of the instrument you are trading. You also have to try and test the accuracy of the trading method, until you are absolutely sure. You can consult the educator or analyst at forexsignal30.com to find out more about this.
Key # 3: Get to know the power of capital
This is very important! The achievement you want to achieve must match your capital strength. That means it is very important for you to recognize the extent of your capital strength.
In general, people who have USD 20,000 in their accounts certainly have more capital than people who only have USD 10,000. Thus, it makes sense that with USD 10,000 capital we only target to get for example USD 1,000 – USD 2,000 per month. Meanwhile, with a capital of USD 20,000, it is also natural if we target to get for example USD 2,000 – USD 4,000 per month.
The strength of this capital will also determine the capital management strategy and risk management as you will apply.
Key # 4: Set a risk limit
This is also important. You certainly understand that there is no business without risk, as well as forex trading. Uniquely, in forex trading it is precisely you who limit the risk yourself.
This is also closely related to capital strength. Limit the maximum risk of the capital you have, for example 50% of USD 20,000. Then you are as bad as you are, only USD 10,000 is lost. This we call MAXIMUM RISK.
Then you also need to limit the risk of each transaction you make. For example 5% of USD 20,000. That is, every time you make a transaction, the maximum loss you will suffer is only USD 1,000. Thus, you will have many opportunities before your maximum risk limit runs out.
If you do not limit this risk, then you will trade haphazardly without heeding the strength of the capital. Facts prove that it is impossible to succeed by trading like that.
Key # 5: Run the trading plan without hesitation
The # 1 to # 4 key above is actually part of the intended trading plan. If you have all that, then there is no reason to hesitate in acting.
So, that’s the five keys to success in minimizing the benefits of forex trading, which you now have. Immediately consult forexsignal30.com education team so you can immediately take advantage of every opportunity that can arise at any time.