The professionals are trading with precise calculations. They are not taking naïve steps to increase their profit. Due to the profit potential of the investment business, thousands of retail trader’s across the globe are actively participating in this market. They are trying to boost their profit by taking a high risk. Such an approach usually results in big losses. To become a currency trader, you should learn about the price movement of the Forex market.
This article is not going to be your traditional read. The key steps of becoming a professional trader will be highlighted. If you can follow the tips of this article, you can get better at trading.
Start with the higher time frame
The rookies in Hong Kong always start trading with the lower time frame. To them, the lower time frame trading strategy is the only way they can make a big profit. If you want to change your life, you should not trade with the lower time frame. The market is full of noise and it becomes very hard to filter the good trades. Even the professionals find it hard to find the best trade setups in the lower time frame. However, you can trade the lower time frame but for that, you have to learn technical parameters along with fundamental factors. By blending these two forms of analysis you can find some good trades in the lower time frame. This requires years of experience and advanced risk management skills.
Lower down the leverage
Those who are trading with an elite broker like Saxo do not have an insane leverage trading account. High-end brokers know the consequences of giving access to insane leverage to retail traders in Hong Kong. It won’t take a month for them to blow up their account. But if you start with a low leverage account, you will be forced to trade with low risk and thus you won’t be able to trade with big volume. This will dramatically reduce the risk of trading. So, choose your broker very carefully as your survival depends largely on their approach.
Create a dynamic trading strategy
You have to create a dynamic trading strategy to make a consistent profit. Those who are using a robust trading method can’t adapt themselves to the market change. So, they lose money when the market changes the trend or its periodic movement. Those who don’t have any idea about the dynamic trading method should read about the price action trading method. The price action trading method is used by skilled traders so that they can adapt to any market condition without losing too much in any single trade.
Follow a trading journal
Professionals always follow a trading journal. A journal is the documented version of all the trades you have executed. With the help of a trading journal, a trader can find the faults in the system. Most importantly, they gain the ability to revise their trading strategy. It might be tough for aggressive traders because they don’t want to keep their opportunities limited by following a fixed set of rules. But following a fixed set of rules is the only way a professional can make a consistent profit.
The famous 1% rule of money management
You have to follow the famous 1% rule of money management to protect your capital. If you break the rules, you are going to suffer like most of the traders. Accepting a 1% loss in each trade is not all tough. It is the most logical way to survive in this industry. However, you should not stick to the 1% rule for the rest of your life. As you gain more experience in this market, diversify your risk factors to become a professional trader. Based on the quality of the trade setup, you can increase or decrease the risk in each trade. So, act smart to survive in the trading business.