For foreign exchange, many people are unfamiliar with it. The fluctuations in the forex market sometimes even baffle many veteran traders. Newcomers who are about to join the ranks of forex traders may have theoretically prepared for the forex account opening process, but when they actually enter the market, they will find that the two words "risk" are not as simple as what is described in books.
After learning about the no-dealer operation platform at Thinkforex, I also became one of the many forex traders. Below, I would like to share my experience with friends who have just started trading forex.
First move: Make good use of financial planning and never use essential living funds as capital. To become a successful forex trader, you must first have sufficient investment capital so that any losses will not affect your life. Remember never to use living funds as trading capital. Excessive financial pressure can mislead your investment strategy and increase trading risks, leading to bigger mistakes.
Second move: Cleverly use limit orders for transactions. At key resistance levels, there are often two situations: real breakout or fake breakout (testing the market and hitting stop-losses frequently occur), and the latter is more common. The establishment of limit orders can effectively prevent false breakouts. In other words, sell or buy orders should be placed 10-15 points above or below the key resistance level. Since this point is often fleeting, only limit order transactions can capture it, which highlights the practical value of limit order transactions.
Third move: Record the factors that determine transactions. Keep detailed daily records of the factors that determine transactions, see if there were any event messages or other reasons that made you make trading decisions, analyze them after making the transaction, and record the profit and loss results. If it is a profitable transaction result, it indicates that your analysis was correct. When similar or the same factors appear again, the transaction records you made will help you quickly make the right trading decision.
Fourth move: Buy high and sell low. Look for currencies from countries with close trade relations and stable domestic politics, buy high and sell low, and there's no doubt you'll make money. Currencies of countries with close trade relations have the tacit understanding to maintain stable interconnection. When Country B's currency drops below the most common price, buy on a large scale, and within half a year, your income will surely be abundant.
Fifth move: Fast and slow in order. Different buying and selling operations for various currencies have different rules. Sensitive currencies have large profit margins, but they also easily fall quickly, and significant fluctuations can occur due to minor events. The most obvious currency with this characteristic is the Japanese Yen, so the operation should be quick buy and quick sell.
Sixth move: Learn to thoroughly execute trading strategies and don't find excuses to overturn previous decisions. The biggest fatal flaw in trading is when you start finding excuses not to cut losses and close positions when your losses have expanded, thinking that the market might turn around instantly. While you continue with this thought, you won't have the heart to end the position where losses continue to expand, and you will lose your rationality waiting for the market to turn around. Please remember a simple rule: Do not let risk exceed the originally set tolerable range. Once the loss reaches the pre-set limit, do not hesitate, close the position immediately.
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