This is a Guest Post by Shaon@MarketTemper.com
Top 10 Forex Trading Tips for the Beginners Part 2
We discussed the top 5 ideal trading habits into our part 1; now let’s discuss part 2 where I’ll be focusing on smart habits, those you need to master to get the maximum benefit from your trading. They are as follows:
6. Stop following others:
Stop following other traders blindly. They could trade a different strategy and a different time frame than yours. You should know their strategy first.
You can ignore major financial news events if you don’t understand them.
You should also avoid financial news networks if you are a technical trader, newspapers could add fiction to make it more eye catching. Remember they are journalist not traders. Be an independent thinker. Successful traders often think from a different perspective than the retail crowds.
7. Be in the real world rather than Hollywood:
Be realistic, don’t dream of a million-dollar profit by investing $1000, that is not possible. Warren Buffet would’ve made ten trillion dollars each year if that was possible. Traders who want to get rich quick always lose quicker.
A strategy is good if it can make more than 5% a month. It is a great strategy if makes more than 10% a month. Even professional traders don’t make money month after month. Luck will help you in gambling or lottery but not in the forex market long term.
8. Choosing the right broker is important:
As I mentioned earlier, a vast majority of forex brokers (not all, mostly MM) often get happy by new traders as they hold positions against their trades. There are some non-regulated brokers who do some bad trading practices but a regulated broker can’t do that.
There are some brokers which have higher spreads, higher swaps rates and other trade restrictions that could make your trading costlier. Compare the best forex brokers using Google or broker comparing portal like ForexTradingBonus.com and choose the right one that suits your trading style. A good forex broker is important. Don’t choose a broker just because someone told you to do so. They could have benefited from referring you to that broker. Choose wisely.
9. The less you trade the more you profit:
Trading with smaller volumes often makes you more profitable long term. Planning a big win using higher leverage is another primary reason amateur traders wipe out their trading accounts. Slow and steady profit wins the trading race. You don’t need to jump on every trade to be profitible. Remain patient and disciplined, control your emotions.
Controlling emotions is not controlling your joy and sadness when you win a trade or lose one, it’s how you interact with the market with your open positions. Your only duty as a trader is to protect your trading capital, making profit is not your priority. Profit is a byproduct of losing less. Try a tiny account if you are feeling less confident at first.
10. Know your Stop Losses before triggering an entry: Exit Plan
Using a stop loss is a must for a new trader. But most newcomers get so afraid of losing money and put a very tight stop loss. A close stop loss won’t save your money, rather it will hurt your balance. Using a fixed pips stop loss is a bad idea. Follow price action and give the stop loss room to breathe. Use, a small lot size if you are afraid of losing money. You should have your exit plan before you trigger the entry. Never ever move a stop loss further away once the market tries to hit it. Don’t get panicked by the losses. Don’t count your winning and losing ratio until you complete your first 50 trades by following your trading strategy.
As you can see, greed can kill a trader’s profit and trading capital. Follow money management put your stops in a safe distance and be disciplined. Learning price action and keeping a trading journal will help you to lose less.
It’s your turn now. Let me know https://www.newtraderu.com/2017/11/20/top-10-forex-trading-tips-beginners/if you are facing any trouble with your forex trading.
Wish you all the best.
About the Author:
Shaon Bhuiya is a price action trader, Fund Manager, Coach and Forex Blogger. He is highly regarded for his unique ‘Core Price Action’ trading strategy. Learn more about him here at MarketTemper. Follow him at Twitter @Shaon77