Starting Forex Trading Also Needs Strategy
Have you ever heard the assumption that if you want to get rich quickly, through forex trading ? Many beginners are also involved in the world of trading because they think so. However, not a few of them then continue to experience loss and even spend the capital they might collect with great difficulty. Tragic, it can even cause trauma so many beginners who curse forex trading again may even spread that forex trading is ” not right “. Though many of the causes of a beginner trader fail because of the lack of knowledge and experience, applying a forex strategy that is careless, or from an unstable emotion.
This simple article will review and dissect what a trader needs to pay attention to in forex trading.
1. Learn really
There is a saying that “do not know then do not love”. The same is true if you are not familiar with the world of forex trading, where you might be able to make a profit. Learn everything related to forex trading as a whole, not halfway. It does take time for a beginner to understand it.However, there is no need to worry that there are many roads, you can learn by yourself and ask the experts.
2. Choose a forex broker that is officially regulated
It is important for a trader to choose a forex broker because of all of our trading activities through the broker. Choose those officially regulated by the government, in this case get permission from the Commodity Futures Trading Supervisory Agency. The location of the brokerage office must also be clear, don’t let your broker be in a country in the middle of nowhere or you could say the address is fake. Equally important, there is a guarantee that your funds will be kept safe.
3. Get to know your character and market analysis
Everyone has a different character, who knows what you are like, only yourself. Why is your character important because the character will shape your trading system and strategy . Do not let you follow other people’s strategies which he says can bring big profits, but may not suit you. The character of a trader also determines he will be a short-term or long-term trader type.
After you really know what your character is, what is equally important is choosing a suitable market. Suppose you want to trade forex , then you have to choose which pair you will trade because each currency pair has a different level of volatility. Remember, don’t choose too many currency pairs because they will break your attention and make you out of focus.And the last try to adapt to the situation of your market.
4. Create a trading plan
The trading plan, aka trading plan, is very influential on the course of the forex trading process. First, you specify your profit target, of course, based on the analysis and current market conditions. Then do not forget to determine the amount of risk that you can bear by installing a stoploss. In determining profit targets and risk loss you must pay attention to the risk-to-reward ratio , which should be a greater profit ratio than loss. Also apply good money and risk management. Always take care that you are always on the right track according to your trading plan.
5. Create a trading strategy that suits your personality
Once mentioned above that a forex trading strategy is not necessarily applicable to everyone. Forex strategy is adjusted to the condition of the character of a trader. There are many kinds of strategies ranging from simple to high complexity. To become a successful trader, you don’t need to pretend to be good at using complicated strategies because it will make it difficult for you. Use a simple strategy that uses sufficient technical analysis. There are techniques using trendline, support-resistance, candlestick pattern, price pattern, and many other techniques. All of these analytical techniques have their advantages and disadvantages. Back to the trader, it was the one who chose the analysis technique like what suits his personal.
6. Practice trading and evaluation of trading strategies
The ultimate point that you need to pay attention to is practicing forex trading by implementing a forex strategy that you have created yourself. The beginners can learn to trade on a demo account to test the strategy whether to make a profit or even lose money. The key is not afraid to try, because your own experience is your best teacher.
After you try your trading strategy, don’t forget to evaluate it. Evaluation is needed to assess the performance of your strategy. The success of forex strategies is seen cumulatively to provide consistent profits. On the course of forex trading experiencing a loss several times is normal as long as it does not exceed your risk-to-reward ratio . And most importantly you should not panic when facing loss. Take a break for a while and find out where your mistakes are so that they don’t happen again. When you feel good and ready, don’t hesitate to do real trading .
Congratulations on trading and good luck always. 🙂