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Forex Trading Training
Trader's mind set & policy|
Forex Trading Training in financial instrument is an art, which everyone cant do. One must learn the basic disciplines of trading in order to effective use the tools & techniques. It is not necessary that one must participate in trades everyday, if he does trade without confident or on participatory sake ending up with red is more possible.
A good trader will never wait for peak or trough to catch any pair of currency, if he is able to trace the trend will take a good entry based on the technical. Every traders decision has 50:50 chances for proving to be wrong. Then how a trader can become successful If he is able to limit his loss and unlimit his profit then he can bring win-win situation in his platform.
How best one person can judge a pair in most volatile situation It is based on the theory and technique he uses for Forex Trading Training. If one person believes in fundamentals than technical, then he will take a trading call based on the fundamentals of that pair.
A good trader will always put stop loss for his trades, but the trader who has taken position based on the fundamental will never see the position to make right entry. He require the help of technical for that, otherwise chances for hitting his stop orders are more and most of the time he will be losing money even though he can give right calls.
A good trader must wear the dress of dynamic personality. He must mix both fundamentals & technical in order to make a right decision. He must be ready to change his trading style according to the changes in the market situation. Assume one person is taking a call based on the fact that euro zone interest rates are going to touch its peak by the end of 2007. So he bought euro today itself, but one important fact to be noted here is market always love to grab the news which are going to be beneficial for the time being. At the same time hawkish comments from the FED people on the same day can lead to a drop of 100 pips in Euro. So the trader must wear the dress of swing trader in order to take advantage of this short term of two sides moves in Forex Trading Training market. He must continuously watch the economic data to analyze the strength or weakness of a pair. He can use the technical analysis for taking the advantage of this swing trades. Basically support & resistance levels will help a fundamental trader to enter the market at right time.
One important fact or theory about a trader is we are the best judge for our traders. One trader may get lot of trading tips or advisory from their brokers or banks, but he must take his decisions based on the strength of his analysis.
A trader must always try to quantify his risk in monetary terms before he initiates a trade. He must always try to play by protecting his equity. One must put limit for his at any time open position. A policy should be framed before starting a trading desk. This policy must be able to hedge his capital beyond a certain level. He must adhere to the strategy or systems prescribed by the policy. Proper record of every position with its reason must be maintained for the better review of performance.
Avoid panic situation. Some times market behavior will be illogic, one must understand even though FX market is highly liquid but player are so big enough to drag sometimes in a different direction either because of large DNT option market or because of high speculative trade ratios.
Most widely used fundamentals are US economic data, Euro-Zone data & other G-7 data. Technical analysis will be help full for a trader who takes short-term positions in the
market. RSI, Bollinger Bands, Moving averages, triangular formations, accumulation-dispersion index, wedges, flag formation, etc will help him in taking the advantage of range bound movements in the pair.
A trader must be ready to change his trading pattern if the market moves against him. Simply that proverb to be remembered Dont fight with the trend; Trend is always your friend. It is very essential in order to protect the capital. A trader must mentally be relaxed during the weekends. He must keep his mind away from the market at least for 5-6 hours in a week, so that he can refresh automatically all his techniques & thoughts.
A sound management of Forex Trading Training in FX spot as well as option market should be given in order to generate good amount of inflow. There are certain exotic creamy structures that can be entered by the trader for making good money. But remember one thing this derivatives have proven several times that it is the major cause for massive destructions of wealth.
A trader must be very patient while doing trades, because FX market is highly volatile so it may take sometimes to get good results. If he is not able to judge the market dept and momentum, then its better for him to sit aside and watch the play.
Ultimately one can become a good trader only if follows a discipline in his trade. He must be patient enough to see his position in green. A proper risk reward ratio must be maintained to see whether expected rate of returns are being generated through his trades. Leverage should not be pulled up to the neck. Identify the certainty under uncertainty and judge the direction of uncertain movements. *Dont worry what market is going to do, but worry what you are going to do in response to the market *It is not the knowledge, age, luck or fluke but its all about the strategy & potentiality which best differentiate & describes trader to trader. Other Articles |
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