I have already been hearing some individuals saying that Forex trading is risky just because a person can lose a lot of money in trading Forex. Using one hand, this can be good news because it's somehow deterred some people from trading Forex particularly when they're not prepared to have proper education to learn how to trade well. On the other hand, some individuals have decided to give Forex trading a decide to try, as they have been told it is really a quick to be rich scheme. Unfortunately, they lost their momentum because they could not find any profitable trading strategies and thus, they concluded that Forex trading did not work.
With due respect, I submit that trading Forex could be a successful venture but we must treat it as a serious business and not really a quick to be rich scheme. What this signifies is that we must understand different segments of a Forex trading business. They're trading strategies, money management and trading psychology. In this short article, I will give attention to the initial segment - trading strategy. what are stock options
I still find it fair to express that Forex traders will first learn trading strategies in this business before they consider the other two segments. However, as some individuals take the view that Forex trading is really a quick to be rich scheme, they do not have the patience to complete the necessary work. Instead, their primary goal is to look for probably the most profitable strategy so that they'll make money in the shortest time possible. My question is whether there is anything called probably the most profitable trading strategy. I am aware by asking this question, I am inviting a debate here since there are tens and thousands of Forex strategies available in the market. All of you'll produce your own personal opinion. If I might, i'd like to first group all Forex trading strategies into four major categories: (i) trend strategies; (ii) trading range strategies; (iii) breakout strategies; and (iv) news trading strategies.
I understand what I am going to express below will disappoint a number of you - there is no such thing called probably the most profitable trading strategy. As traders, our job is always to see the chart of a currency pair and decide if it's in a trend. In that case, we have to utilize trend strategies because it does not seem sensible to utilize trading range strategies. Conversely, if the currency pair has formed a trading range, it does not seem sensible to utilize any trend strategies. Therefore, we have to utilize trading range strategies. Simply speaking, a trader will need to learn at least one trend strategy and one trading range strategy.
Some of my trading buddies would rather trade the Forex market predicated on news. What they do is to look for the news headlines to trade and consider what sort of particular currency pair will react following the announcement. Typically, news trading strategies will be a quick scalp on a currency pair and are based on a graph on a lowered time frame.
Finally, the key reason why breakout strategies exist is because there are traders who would rather take a position on a currency pair after it breaks out of a trading range. trading strategies
As you can see, different traders can have different trading preference. The first thing I believe you should do is to discover your own personal preference. Have you been someone who is ultra conservative and you don't want to risk much in a trade? Or have you been someone who is aggressive and it is okay for you yourself to cope with higher risk investments?
Even though I mentioned news trading strategies here, I don't trade some of them personally because they do not fit my trading personality. I am just about emphasizing both trend strategies and trading range strategies.
Here is another important point for you yourself to consider if you are learning any strategy from another person. I am sure that the person from whom you learn can have their own trading rules. You have to ensure these rules fit your own personal trading personality. Or even, it is probable this strategy will not work for you though it works for that person. If you determine to tweak these trading rules to suit your preference, you should be prepared to spending some time on back-testing and forward-testing the modified strategy to ensure it generates positive results consistently.