Most traders know the feeling. They spend years building a trading strategy, trying to trade on demo accounts and then, after lengthy and careful contemplating, they find the confidence to go out into the world of real trading.
A lot of things in Forex trading and generally in our lives are simply outside of our control.
You may have the perfect signal, or in fact, a multitude of signals - all converging and agreeing that a particular currency pair should be moving higher or lower. Nevertheless, there is always some probability that any signal or setup will fail and the market will go in the opposite way. But the important thing to realize is that we can not control the outcome of the trading setup and therefore the chance of being wrong should not disturb us.
How is this even possible? What is the problem? This will be the topic of today’s article.
Has it ever happened to you that the broker deepened your loss compared to the one which was originally set as Stop-Loss?
Do you know why?
So many traders want to find that one tool or indicator that will do it all in trading so that they won’t need to look at any other indicator.
The average daily range is a nice tool (or maybe better said, just a useful statistic) that’s most practical for day-trading the Forex market, although it’s definitely also useful for other trading styles like scalping or swing trading.
Forex trading is, without a doubt, a very speculative type of investment that requires making very good and suitable market predictions that make your chances of generating profit higher.
While losses are an inherent part of the world of forex trading, a number of measures have been created since modern forex trading has come around that can be used by traders to not only protect their own capital, but also to potentially increase their success rate in individual trading sessions.
This article will not tell you about all the individual order, what we would like to tackle, at least partially, is the issue of frequent closing of profitable or losing positions.
Keeping a trading journal plays an integral part in becoming and staying a profitable Forex trader. The professional traders and the best traders know this and they always keep a trading journal.
It’s easier to deal with fear when you realize that the emotion of fear cannot exist if it is not preceded by worry which is preceded by doubt. In fact, it all usually starts with a tiny bit of doubt about a small aspect of a perfectly fine trade. The doubt soon turns into worry which soon turns into fear and that soon causes the trader to emotionally act on his/her positions.
You have probably noticed that we frequently talk about the 50, 100 and 200 period moving averages in our daily and weekly posts that are regularly published in the FxTradingRevolution news section.
Considering that one of the basic rules of technical analysis is essentially a self-fulfilling prophecy, it’s no wonder that these 3 moving averages work so well in the Forex market. Basically, the more people look at and trade by the same price level the more likely it is for that price to be important in some way (i.e. to be a point of reversal). Since a lot of traders are plotting the group of the 50, 100 and 200 moving averages on their charts, it only makes them a more reliable trading indicator.
We all know that trading Forex is a risky business and we encounter risks with each trade on a daily basis. It’s our duty as traders to protect our capital from these risks as much as possible.
In investing and in life generally, we want to pay for assets, products or services that are at least at a fair price in order for those to be valuable in the longer term.
Generally, it is seen as something negative and everybody wants to avoid it, but experienced traders realize that losing is the only thing we can control through money management.
The approach towards losses is clear: they have to be as small as possible. The lower a loss is the better.
Specifically, there are two key aspects of your account statement that give a valuable insight into how well you are performing as a trader. Essentially, these two key aspects are the relationship between your average winning trade to your average losing trade and the win per trade ratio or also known as the winning percentage.
A common question in the Forex community, especially asked around a lot by rookie traders, is whether fundamental analysis or technical analysis is better to trade the Fx market.
There are countless ways for traders to improve their trading sessions. Below are a couple of tips that can be used with almost any trading strategy.
Get to know price action and important price levels on the charts
Price action is, without a doubt, one of the most powerful weapons of many traders today. Price action usually has the highest predictive value because it’s not created by complicated calculations, but by the market.
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