Forex Trading Strategy – 6 Vital Questions You Must Answer To Succeed
1. Are you confident in logic?
This may seem a strange question, but it is a fact, that many traders do not understand their forex trading strategy and will not be confident in it when until they lose.
The reason is that in most cases they follow a guru or mentor and have not created the system theirself.
Well, building a currency trading system is simple and anyone can do it without any problems, but most traders fall for purchasing an e-book or trading system online for several hundreds dollars and hope to reap large profits.
Most of the systems being solved online are not effective.
The best way to do it is to learn a system yourself and become totally aware about its work. You will not only avoid hypes but you will also become confident and disciplined when placing trades.
2. Is it Objective or Subjective?
When trading, make sure that your system comprises objective rules and not patters that demand much objective judgment. For instance, according to Elliot wave theory and cyles mean that you should make subjective judgments. Doing this you may get overwhelmed by emotions which lead to losses.
2. Does It Trades the Odds?
Do you try and forecast if levels of support of resistance will hold and hope they really do?
For instance, do you:
Purchase above support or move average or sell into a double top?
If yes, you will experience losses, because you are not trading the odds before you give your trading signals. To trade the odds, you should use confirming indicators to give you keys to moves in price momentum. If you forecast that you will lose, if you confirm the signals at vital levels, you trade the odds and can win.
4. Make sure that your trading system is simple.
You will lose, if your trading system includes many indicators and rules.
Your chances of success will rise significantly if you keep your trading system simple.
5. Is it applicable on all markets?
If you always change the rules and parameters of forex trading strategy for various market conditions or various currency pairs, you will lose.
6. Does it have specific Money Management System?
It does not mean just placing stops, but how make profits with trailing stops on open positions and applying profit goals.
The border between success and failure is very delicate and money management increases your chances for success.
7. Why do you think that you will win?
Why your trading method should be successful while the statistics states that 90% of forex traders lose?
If you do not know the answer to this question, you will not become wealthy in froex.
Due to troubles in the economies of many countries Forex is a very popular way of earning money. Those who are looking for effective strategy, might be interested in managed forex account. But please make sure to read about forex trading scam before dealing with forex trading.
It is a must to read unbiased reviews and perform forex scam check before you invest money into trading activity. This is important, don’t forget that we live in the world where info quickly enhances the quality of our life.
Due to this if you are properly armed with the info in your sphere of interest you can be sure that you will always find the solution to any bad situation. So, please make sure to get back to this site on a regular basis or – the easiest way to take care of it – sign up to its RSS feed. Thus you will have your hand on the pulse of the freshest info updates here. Blogging can be helpful, you just need to understand how to use blogging for the currency exchange market.