Forex trading or foreign exchange is a business that can bring big profits in a short time. But keep in mind, forex trading can also impoverish you in a short time. Therefore many traders try to minimize the risk of trading in various ways but often fail. The following are ways to learn to minimize risks in online forex trading .
1. Over Trade.
Excessive trading is very risky, so you need to make very careful calculations. The calculation in question is how many lots will you trade. What is your daily loss limit, 10% of your capital is good enough. Determine your daily profit target and be disciplined in implementing it. If the target is met, stop trading, close your meta trader.
2. Understand the effects of a fundamental news.
Sometimes technical analysis that has been prepared carefully has run aground just like that. Traders who make transactions by relying on the news several times must be disappointed because the results are not in accordance with what has been predicted. So, it is very necessary to understand a news that will be announced clearly and find out the impact of the news.
3. Do not depend on others.
This often happens on some social media. If anyone posts the results of the transaction on Facebook / forum and seen the results continue to profit, the post will be called “master”. Thus, you will be asking questions, asking for a signal and even following the open position done by the master, hoping for profit from the analysis of others. If the result is indeed profit, the master will be more leased. But if it turns out to be a loss, the master is encouraged. Instead, use your own analysis, whatever the results. And learn from mistakes when analyzing (use a demo account). A successful trader is a trader who relies on his own abilities, so he knows, the analysis is effective or not.
4. Over Confident or brilliance.
This often has a big impact on trading . The brilliance when trading is very dangerous because you don’t know what will happen in the market. No one knows, the market will move where.
These are traders who rely too much on charts or charts in trading . It is true that price movements tend to move with the existing pattern, but certain fundamental / policy data can change the direction of the market trend. So it’s good for you to combine technical and fundamental analysis in forex trading .
6. Always use Stop Loss.
This is what sometimes makes traders dilemma, when trading and stop loss is affected, the price reverses direction from the one predicted. But of the many cases that have happened it has been proven that without a stop loss trader losses can get worse. Starting from loss, leading to auto cut. Do you want?
7. Simple trading system.
Some traders argue, using many indicators to ensure a better trend direction. Besides that it will get more signal. But the truth is, the more indicators that are installed, it will make you dizzy and even confused 🙂 Because each indicator gives a different signal. Use only 2 or 3 indicators, but are really understood. For example, you put up 6 indicators, so you get the maximum signal. You have to understand the indicator correctly, right? Say in 1 month you learn these 6 indicators, surely your understanding of each of these indicators is only about 17%. Different if you only learn 2 indicators, of course you will be able to understand 50%, right? Basically, all indicators are the same, only the ways of understanding are different. Better if combined with fundamentals.
8. Using Expert Advisor (EA).
Many forex traders are too sure to use EA in their trading systems. They enter the trading system algorithm into a trading robot system so that they don’t need to be tired of the chart. But you need to remember, market trends are always changing and no one knows where the price is going. If you use EA, always control the trading robot system that you are using and keep updating the system.
9. Trading by moment.
You are not required to enter positions every day. Take a position when you see a good moment to enter. If there is no good moment and the signal indicator does not provide good confirmation, you should not take a trading position.
10. Cut loss is necessary.
Cut loss is that you close a losing position because the price is opposite to your analysis. Do not hesitate to cut loss if after you analyze again it turns out that the price moves against the previous analysis. If your decision is to make a true cut loss, then you will avoid greater losses. If it turns out your decision is wrong, at least you have reduced the loss at that time. Learn from the mistakes you have made. Remember, a trader who fails is not a trader who dares to cut loss, but a trader who fails is a trader who is affected by auto cut because he does not dare to cut loss.
11. Take advantage of free signals.
In forums like Facebook, Twitter, blogs and others, many share free forex trading signals. You can use it as a second opinion in making open position decisions. We recommend that you test the free signal accuracy using a demo account before trading on a real account.
12. Never stop learning.
Beginner traders usually consider forex trading easy, so it’s not serious in learning forex again. By continuing to learn forex , you will increasingly know the ins and outs of the world of trading. Because the trading world has no limits.
Such are some tips on how to learn to minimize risk in online forex trading . Hopefully useful and can improve your trading skills so that the profit you will get.