Forex trading system leads to profitable trades
To be a profitable FX trader you need to develop a trading system.
Your system needs to be tested and then implemented which will take
most of the guess work and risk out of a trade.
You need to know how many lots you want to trade and where you want to
place your stop losses and take profit. Try and take all the guess
work before you make a forex trade.
You should have the charting indicators set and only use a couple. Too
many indicators will only confuse you and make the trade more
difficult. Make sure to use stop losses to control the trade and save
your trading capitol.
trades can't be in the money due to market conditions and news that
can influence the markets to go against you. That is why you have to
have a trading system that includes stop losses. This way you can cut
your losses and keep them small and move on to trade another day.
Saving capitol is your first goal and then making money.
When you let you winners run part of your trading system should be to
know when to get out of the currency trade. You should know where the
resistance might be so you can take your profits. This is how you make
money by closing the trade and not getting greedy. You will know your
exit of the market pairs at the time of initially making the trade.
If the trend is in your favor you can always add to your forex trade.
When you have a strong trend this is a great time to add to your
position. Remember to move your stop loss to break even or where your
trading system put you in a free trade situation. Successful FX
traders all add to their positions when they have a strong trend
moving in their favor.
If you are swing trading then knowing the positions you want to exit
should be part of your trading system. By knowing your exit strategy
will keep you making money when you swing trade the forex. With proper
currency trading management it becomes possible to maximize your
trades profit and remove most risk from the FX trade.
Your trading system should include what size lot you want to trade and
how much money you want to risk on each trade. If the trade is more
risky you might want to use a smaller lot size and add to the trade
after it is going in your favor. If the forex market is choppy and
range bound then smaller trades would be better and this will preserve
your capitol keep emotions out of the trade.
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