How to be a successful Forex Trader

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Maximise your profits and cut the risk!

How to be a successful Forex TraderOnce you have opened an account with a Broker, traded a few times and got used to the Currency Exchange terminology, it’s time to look at what makes a successful trader. Why do some traders always make a profit, while others struggle with losses? Here are some of the strategies successful traders use:-

· Use your intelligence to gauge which situations are extremely likely to succeed. Many traders made millions following the recent Brexit Vote in the UK by selling the pound before it fell. Very simple and easy to predict!

· When you see a situation such as the one above, trade big! The frequency of your trading is less important than trading the right currencies at the right time

· Stay on top of what you are trading and when. Keep a diary of what currencies you have traded, the fluctuations and see if you see any patterns emerging. Use these patterns to buy and sell at the right time to maximise your profits. Form a strategy about how you will trade and stick to this.

· Look at both sides of every situation. The ability to see the market from your point of view and the point of view of those on the other side will prevent many losses. Information is key, stay on top of both sides of the market and trade wisely.

· Retrain yourself not to expect markets to fall after they have risen. Surprisingly, markets tend to rise and then rise again, or vice versa. The inexperienced trader will start trading at the end of this cycle, for fear of missing out on huge profits. Knowing when to go is a skill, and it is worth using charts to look at previous trends in order to better predict how long a rise/rise will continue.

· Be Confident about your trading. If you have bought currency and believe it will rise, stay true to that belief, even if it falls. Many losses are incurred by people panicking at an unexpected move and selling at a loss.

· When setting your stop/loss markers, think about what the profit or loss will actually mean to you, instead of setting them at random levels without any thought. Very often simple mistakes such as these will make a huge difference to the long term fortunes of traders. Whilst your markers might be logical when you look at the market, are they losses that you would want to incur?

· Keep emotions out of your investments. Although you might well have loyalty towards a certain currency, or a personal relationship or belief in the market, this loyalty will not stop you losing money. If you keep your investments driven solely by business you will make more sensible decisions long term.

· Take your time. Don’t feel you “should” do anything just because you are a trader. Research has shown that the traders that make the most profit do not trade regularly, and instead take a long term approach to their trading.

· Always have an exit strategy. Losses are a part of trading, decide beforehand how much loss you can sustain before you leave. Never chase your losses and accept that loss is a part of the trading experience.

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