New forex traders can have difficulty building their own forex trading system. This is because forrex trading strategies requires good knowledge to begin developing a strategy. Here is given important tips to help new traders to achieve success in forex trading.
1. Use a weekly chart: using weekly chart can give clearer view of the trend. Trends that are going big are visible on the weekly chart. Weekly charts are also more useful for long term traders and can help to define the support and resistance levels. So it is a good idea to begin with it.
2.Don’t trade too much: many traders get failed in trading forex because they trade too much in any given period. Most traders think they can achieve success by their efforts and how often they trade. This is not true because the forex market is fluctuating and need the right time to decide when trade and when not. Therefore, when trading forex, be careful in your decision.
3.Increase your risks for any featured trade: This tip is overlooked by most traders. Many forex trading sites recommend risking no more than 2% of the overall account. This is true for very large accounts. But if your forex account is not too large, say 10 k dollars, you can risk 10 – 20%. This way you can achieve more profits. To make meaningful gains you have to take risks. If you don’t like taking risks don’t trade forex.
4.Make one trade at a time: if the trader has a small account, he must not make many trades at any time. Instead he must concentrate on one trade only. This will give more opportunity to success in the deal entered.
5.Determine a profit target for your trade: going to know where to stop losses is common to all traders but knowing the profit target can be overlooked. The traders must look at all factors when trading and not only on the losses. This will not make the trade to be based on strategic plans.
6.Build proper strategies: new forex traders need to build the trading strategy. Even old traders can try new strategies to see if there are better ones. One of the important factors inside the strategy is the analytical tools used to determine the trend. These analytical methods must not e complicated. Often two or three methods can be sufficient. Don’t use more than three analytical tools to know the trend. Chart analysis strategy also must not be too simple to make good prediction for the trend.
7.Use adequate leveraging: each forex broker determine the leverage value to be used. Very high leverage can be against you depending on the account size. Small accounts must use lower leverage to be able to stand high currency fluctuations. Large accounts however can use higher leverage because it will stand more fluctuation but the losses can be higher. New traders must begin of course with the lowest leverage value because the accounts they begin with will be small