Many novices keep enquiring- how much scope one has to procure decent Forex trading profitability?
This is a question which has been the subject of debate for quite some time now. Interestingly, because of some investors who despite their efforts are not able to win has given rise to such shadow of doubts. The market is known to churn over $5 trillion yield and many do believe that it is one of the best investment ventures for newbies.
Forex as a Venture calls for Proper Research and Market Knowledge:
Similar to most investment ventures, FX despite its profitability also has its fair share of risks. The trick, however, is how to mitigate those risks and stand on the greener side of the transaction. Risk and money management are two of the primary aspects which most newbies have to give importance to.
There is simply no point investing all their cash and without proper analysis of market variables step foot into the market. Experts believe that is no way to approach the market and those who face suffer tremendous losses in money and a dent in their confidence.
Forex trading success is highly relevant to the amount of research you are ready to do per trade. In answer to the question- Forex is it profitable? – Sure it is provided you are ready to comprehensively analyze charts and trading indicators to determine your trade entries points.
Plus you also need to understand the active market variables which play a crucial role in influencing the market. The market is known for radicle shifts or fluctuations. Having adequate knowledge about those variables and the cause of those fluctuations allows one to counter market movements.
Profit only comes to wise traders- 4 tips to smarten up newbies!
The degree of Forex trading profitability also depends on how smart you carry out your trades. Obviously, it would be tough for a newbie to know each and everything. So here are some tips for them to trade the smart way.
• Tip 1
The rule of trading is never to exceed 20% of their total capital when investing in a single trade. Settling for small wins, especially in your early stages has its own perks. Yes the amount you win is small, but the winning strategy you use is your big ticket to FX riches.
• Tip 2
There is no guarantee that having the best indicators in the market will bring you riches. Rather you should smartly use indicators which come with different features. It’s useless having 2 technical analysis tools which serve the same purpose.
Example- You should ideally look to use Strike and ATR- Average True Range. Reason being- Strike indicator tells you about trade entry points, while ATR reveals you about exits and momentum of the market.
Both indicators show you different aspects of the market and help you to keep an eye on both at the same time. This forms the basis of strategy formulation and it’s what you early should look to do.
• Tip 3
Staying tuned with latest feeds is also something which you need to make a habit of early on. These fundamental variables do play a crucial role in influencing the nature of prices and also the way the market moves over a particular period of time.
• Tip 4
Forex Trading involves no room for emotions. So you should keep them away and learn the art of making realistic calls when trading. You should not get carried away and over trade when the rub of the green goes your way. Neither should you lose hope and quit trading if you incur consecutive losses. It’s all about doing the math right.
Forex trading profitability is there for you to procure. Only you need to act a bit smart and do the calculations properly. These tips will surely help you make the most of whatever opportunities come your way.
The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteForex. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC.