Robinsonlino
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KEY FOREX GUIDE FOR CONSISTENT PROFIT.
There can be many strategies to consistently profit in Forex, however, in this article, we will discuss some important ways to achieve progress:
CHOOSING AND TESTING A CONSISTENT TRADING SRATEGY.
When discussing how to make a consistent profit in Forex, it has to be mentioned that the first logical step is to choose a trading style. There are several options, but they mostly fall into one of those categories;
Scalping
*Day trading
*swing trading
*News trading
How to be a consistent Forex trader, when there are so many trading styles to choose from? Well, you need to work hard to find out which style is best for you.
SET A GOOD RISK REWARD RATIO TO 1:2 OR HIGHER OR HAVE A GOOD WIN RATE.
If you're wondering how to make profit in Forex, there are two general ways to do that. If you follow the first way, you can make profits even if your predictions come true only 50% of the time. For that, your risk to reward ratio needs to be 1 risk : more than 1 reward. Usually traders pick 1:2 risk/reward ratio or higher. For example, if a trader aims to gain 100 pips from a given position, he or she might consider setting the stop-loss order below 50 pips of the current market price. However, keep in mind that the setup should dictate Stop Loss and Take Profit targets and not your trading agenda. If the setup doesn't give you an opportunity, you shouldn't force a trade.
The second way to make consistent profits from trading is to have a higher than 50% success rate on your predictions. That way, even if the risk to reward ratio is 1:1, the system will produce account balance growth over a certain number of targets.
SETTING A REALISTIC PROFIT TARGET.
To learn how to be profitable in Forex, we must first learn how to get realistic expectations. If your expectation is to double your deposit every month, you will use risky strategies and endanger your account balance. What's more, you need to learn more about the instruments you are going to trade.
Every currency pair has a different average daily volatility. For example, EUR/CHF moves by 50 to 55 pips on average, as the two currencies are highly correlated. Consequently, it might not be realistic to set a daily profit target with this pair at 100 pips. For such ambitious goals, there are other currency pairs such as GBP/AUD or GBP/NZD, where their daily fluctuations might range between 190 and 210leverage
AVOID HIGH LEVERAGE.
The best Forex strategy for consistent profits should include risk management. High leverage increases trading risks. Many highly regulated brokers offer maximum leverage of 30:1, 50:1. And that simply means that you can get up to 50 times the purchasing power on your deposit. However, it is not a simple coincidence that many financial commentators describe the leverage as a double-edged sword. The problem is that over-leveraged trading can easily lead to severe losses, from which it will be very difficult to recover. Leverage can increase your profits, but it can just as easily wipe out your account balance. You can find some brokers that offer up to 300:1, 500:1 or even 2,000:1 leverage.
NOT RISKING MORE THAN 3% ON A TRADE.
To answer the question on how to profit from Forex trading, you need to learn how not to lose your trading capital. Professional traders grow their trading balance gradually and steadily. They manage drawdown periods well and do not take wild risks. Most professional traders only risk 1-5% of their trading balance per trade. Profitable and consistent trading is all about probabilities. When you break that balance and take larger risks, results get dependent on single, particular trades that can either skyrocket or destroy trading balance.
KEEPING A TRADING JOURNAL.
Trading journals help traders learn from their own mistakes, discover strengths and weaknesses in their trading strategies, and improve results. Most professional traders are using some form of trading journals. They keep traders to be accountable and take more reasonable trades. They also help avoid opening unnecessary trades. And it's logical, when you are documenting your trades, it's more likely to be more selective in your trading setups and avoid mistakes.
Consistency in Forex trading requires dedication and hard work. You need a trading system that includes trader, trading system and strategies for self growth. Your trading plan should include working hours, trading strategy, trading journal and tools for improvement.
There can be many strategies to consistently profit in Forex, however, in this article, we will discuss some important ways to achieve progress:
CHOOSING AND TESTING A CONSISTENT TRADING SRATEGY.
When discussing how to make a consistent profit in Forex, it has to be mentioned that the first logical step is to choose a trading style. There are several options, but they mostly fall into one of those categories;
Scalping
*Day trading
*swing trading
*News trading
How to be a consistent Forex trader, when there are so many trading styles to choose from? Well, you need to work hard to find out which style is best for you.
SET A GOOD RISK REWARD RATIO TO 1:2 OR HIGHER OR HAVE A GOOD WIN RATE.
If you're wondering how to make profit in Forex, there are two general ways to do that. If you follow the first way, you can make profits even if your predictions come true only 50% of the time. For that, your risk to reward ratio needs to be 1 risk : more than 1 reward. Usually traders pick 1:2 risk/reward ratio or higher. For example, if a trader aims to gain 100 pips from a given position, he or she might consider setting the stop-loss order below 50 pips of the current market price. However, keep in mind that the setup should dictate Stop Loss and Take Profit targets and not your trading agenda. If the setup doesn't give you an opportunity, you shouldn't force a trade.
The second way to make consistent profits from trading is to have a higher than 50% success rate on your predictions. That way, even if the risk to reward ratio is 1:1, the system will produce account balance growth over a certain number of targets.
SETTING A REALISTIC PROFIT TARGET.
To learn how to be profitable in Forex, we must first learn how to get realistic expectations. If your expectation is to double your deposit every month, you will use risky strategies and endanger your account balance. What's more, you need to learn more about the instruments you are going to trade.
Every currency pair has a different average daily volatility. For example, EUR/CHF moves by 50 to 55 pips on average, as the two currencies are highly correlated. Consequently, it might not be realistic to set a daily profit target with this pair at 100 pips. For such ambitious goals, there are other currency pairs such as GBP/AUD or GBP/NZD, where their daily fluctuations might range between 190 and 210leverage
AVOID HIGH LEVERAGE.
The best Forex strategy for consistent profits should include risk management. High leverage increases trading risks. Many highly regulated brokers offer maximum leverage of 30:1, 50:1. And that simply means that you can get up to 50 times the purchasing power on your deposit. However, it is not a simple coincidence that many financial commentators describe the leverage as a double-edged sword. The problem is that over-leveraged trading can easily lead to severe losses, from which it will be very difficult to recover. Leverage can increase your profits, but it can just as easily wipe out your account balance. You can find some brokers that offer up to 300:1, 500:1 or even 2,000:1 leverage.
NOT RISKING MORE THAN 3% ON A TRADE.
To answer the question on how to profit from Forex trading, you need to learn how not to lose your trading capital. Professional traders grow their trading balance gradually and steadily. They manage drawdown periods well and do not take wild risks. Most professional traders only risk 1-5% of their trading balance per trade. Profitable and consistent trading is all about probabilities. When you break that balance and take larger risks, results get dependent on single, particular trades that can either skyrocket or destroy trading balance.
KEEPING A TRADING JOURNAL.
Trading journals help traders learn from their own mistakes, discover strengths and weaknesses in their trading strategies, and improve results. Most professional traders are using some form of trading journals. They keep traders to be accountable and take more reasonable trades. They also help avoid opening unnecessary trades. And it's logical, when you are documenting your trades, it's more likely to be more selective in your trading setups and avoid mistakes.
Consistency in Forex trading requires dedication and hard work. You need a trading system that includes trader, trading system and strategies for self growth. Your trading plan should include working hours, trading strategy, trading journal and tools for improvement.
