Trading advices in forex

Market Analysis

Forex is not a funny game
Any attempt to trade without analysis and studying the market is equal to a game.

Practice
Allow at least 2 months for demo trading. Consider this: 95 % of the beginners fail to succeed in the real money market due to lack of knowledge, practice and discipline. Those remaining 10% of successful traders had been sharpening and shaping their skills on demo accounts for years before entering the real market. A good demo account to start practicing with could be, for example, Investment House Forex.

Analyze more than one timeframe
It gives the bigger picture of market price movements and thus helps to clearly define the trend. For example, when trading with 15 minute time frame, take a look at 1 hour charts. In the same way: trading with 1 hour charts would require obtaining a picture of daily, weekly price movements.

Don’t trade for revenge
Don't try to revenge after losing a trade. Don't be greedy by adding lots of positions when winning. Overreaction blocks clear thinking and as a result will cost you money. Overtrading can shake your money management and dramatically increase trading risks.

Be sure as much as you can be
When in doubt — stay out. If it is not clear where the market will move — don't trade. In this case saving your present capital is a better choice than taking additional risks and losing money.

Don’t hope
Hoping that market will turn in your direction is a very delusive hope. By moving a stop loss further a trader increases his chances to end up with a much bigger loss.

Choose your information
Too much information will create a controversial picture of when to trade and when not to. To avoid lots of confusion create a simple but working method of trading Forex.

Risk/Reward
How much money can you lose in this trade? How much can you gain? Now, make a decision if the trade is worth entering. Example: if trader is looking for possible 80 pips gain and possible 60 pips loss, such conditions are not worth trading. Compare it with the situation when a trader has 120 pips of potential gain and only 30 pips of possible loss. This is the trade to open!

Let your profit run
Let your position be open for as long as the market wishes to reward you. Of course, for this traders need a good exit strategy, otherwise they risk to give all profits back... Running two or more open trades gives an option to close some positions earlier and keep others running for higher profits.

Close unprofitable trades
It's better to finish unprofitable trade quickly than wait for the situation to get worse. Don't put a stop loss too far — it's your money you risk.