Hot Tips for Successful Online Forex Trading - Part One
There is no one-size-fits all solution for online forex trading.
You will do your most successful online forex trading with a
system that is customized to fit your needs, your style of
trading and your risk comfort level. Then you need the
discipline to follow your system, capital to work with and a
willingness to approach each trade with energy and enthusiasm.
That being said, there are always a few things you can watch for
with your online forex trading career. A few pointers that will
help you steer clear of mistakes and keep you on the path to
success. I`ve gathered some of these useful tips in this
article. Keep them in mind for when you`re uncertain what to do,
and incorporate them into your system. They will make a
difference in your trades.
Online Forex Trading Tip #1 - Never add to a position that is
losing. This is one of the few trade rules that you should never
break. If you`re losing money on a position exit the trade,
don`t add to it. This is how small losses become large losses,
which leads to traders no longer trading.
Online Forex Trading Tip #2 - Always set your stop losses and
decide when you will take profits before you enter a trade.
Place stops that are based on market information, and not your
account balance. If a "proper" stop is too expensive for you,
don`t make the trade. Be sure to decide when you are going to
take your profits and follow through on it. Successful traders
are successful because they keep their losses small, and they
take their profits often.
Online Forex Trading Tip #3 - Pay attention to the market. Exit
and enter trades based on market information. Don`t wait for a
price you think the currency should hit when the market has
changed direction on you.
Online Forex Trading Tip #4 - There are times when, due to a
lack of liquidity or excessive volatility, you should not trade
at all. On a similar note, never trade when you are sick. You
can`t count on yourself to be alert to the shifts of the
markets, and make good decisions.
Online Forex Trading Tip #5 - Trading systems that work in an up
market may not work in a down market, and a system that works
for trending markets, or for range bound markets may not work in
other markets. Have a system for each type of market.
Online Forex Trading Tip #6 - Up market and down market patterns
are ALWAYS there, but you have to look for the dominant trends.
Always select trades that move with the trends Online Forex
Trading Tip #7 - During the blow-out stage of the market, either
up or down, the risk managers are usually issuing margin call
position liquidation orders. They don't generally check the
screen to see what`s overbought or oversold; they just keep
issuing liquidation orders. Make sure you stay out of their way.
Online Forex Trading Tip #8 - Trust your instincts. If something
feels wrong about a trade, don`t make it. It`s better to be
superstitious than to loose money.
Online Forex Trading Tip #9 - Rumour is king. Buy when you hear
the rumour, sell when you hear the news.
Online Forex Trading Tip #10 - The first and last tick are
always the most expensive. Get in the market late, and out
early. And never trade in the direction of a gap, either opening
or closing.
Online Forex Trading Tip #11 - When everyone else is in, it's
time for you to get out. If a stock or currency is overbought,
it`s time to exit your position.