How to take your Forex trading to the next level.
Let us understand first what forex is and how it works. Forex is an asset class to trade moreover it is decentralized globally.
It is also known as a currency market in which trade takes place between currencies. Values of currencies are determined. This market is greater than the share market and also from the commodity market.
Here in the forex market risks are high if you don’t plan strategically as compared to other markets. all over the world. Its size and annual turnover are 6.5 trillion US dollars a day. according to statistics, it is the largest and only financial sector that dominates the world.
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How much risk is too low?
As early we said that risks are high in forex let me explain how risk can be lowered. For example in stock exchange market goes like 10 % down in just two to three days goes up also in a few days and the margin in the stock market is between only 8% to 10%.
But in the forex market just goes up and down like 1% 1.5% 0.5% and the margin is approximately 25% to 30%.
How does it work?
Let us take one example: you have one 1 lakh rupees in and you went to exchange for converting that into dollars.
The rate in that time dollar rate was 75 rs ( 75 RS =1 USD) and you got 1333 dollars after some time you think that you want high again in rupees, you reached to exchange this time rate was 77rs ( 77 rs =1 USD ) this time instead of 1 lakh you got 102641 rupees you got leverage of 2641 INR.
Now, in this case, you don’t need to go to an exchange you can trade online by sitting at home.
Tips/rules to take your forex trading to the next level:-
Always open trading according to your equity
More than 70 percent of forex traders are not following this rule. The trading lot size and trading volume always depend upon equity. What is your amount of equity according to that open and you have to trade here we have taken out a graph according to that you can open your trade.
| EQUITY | LOT SIZE |
| $100 | 0.01x2 = 0.02 |
| $300 | 0.01x6 = 0.06 |
| $500 | 0.01x10 = 0.1 |
| $1000 | 0.01x20 = 0.1 |
Who are taking forex as Gambling this chart is not for them. If you want long-term earning and good profit then you must follow it. Let us now understand the upper chart.
For example, if your equity is 100 then the maximum you can buy 2 trades of 0.01 or 1 trade of 0.02 and for 300 equity their maximum trade volume must under 0.06 same criteria for 500 and 1000.
One important point to note is that always trade in the currency which fluctuates the least, as you can go with EURO or USD. if you increase the maximum limit then there are chances that you will get a loss but if follow the chart then definitely get a profit.
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Always use take profit, stop loss, buy limit and sell limit
Especially beginners who are recently entering this market are not using these features. They are thinking that they will have their mobile in their hand when they want to enter and exist they can. but nothing like this is happening in the forex market. Using take profit, stop loss, or buy limit and sell limit is mandatory here.
If you want to save your equity for the long term, you must use stop loss, especially if you don't use stop-loss then there are chances of getting your account empty.
If you cannot sit for a long time for trading then you can use take profit for regular time and regular profit do not buy or sell on normal rates always when rates go up and down then you can buy or sell.
We recommend you to use all of them because the changes in profit will be more and loss chances will be very low.
Always control your emotions when the market is against you
People always get loose when the market is against them. They lose their control over minds and emotions and take the wrong step then go into a loss.
We have seen many traders who were getting profit for a long time but when the market goes against them and they trade into the wrong side as they want to recover fast but they get into more losses after that their account becomes zero.
You have to put this in your mind that the market always doesn't support you. Sometimes it goes against you. so you have to control your mind and emotions.
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Always set a profit target after that don’t open any trade
You need to set a goal of your profit in mind when your target is completed. After that do not open any trade for example if your equity is 500 then you can set a target between 10 to 30 dollars a day. suppose you think of 20 dollar profit.
When you compete with 20 after that you must never open any trade on that day. do not become greedy we have seen many who become greedy and get big term losses.
Not believe any indicators or signals groups or technical analysis charts blindly
We have seen many traders who are looking for charts that always profit. So we tell you that nobody can tell us which currency will go up and which will not. These groups can say with a 100% guarantee that their total signal will hit but there are chances of getting 7 hits out of 10.
The thought is that the remaining 3 are sufficient to make you lose. do not believe any group completely do your own research you can take the help of groups always trade with your own analysis.
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