Four proven steps to trade like a pro trader
Have you ever wondered if there is one single best formula to trade for a long time? If yes, you must have come across many blogs and videos to know about it. But nowadays, the internet is filled with misinformation and scam that lead people in the wrong directions. To help you, this article gives you trustworthy details on the topic.
Before deciding to trade a single pair, one should justify his cause. He should find out the disadvantages he has been facing while trading multiple pairs. Another piece of advice would be to invest enough time into single pair investment before judging the method.
Pick a Suitable Currency Pair
There is nothing like one ultimate pair or the best pair to trade. The best one will depend on an individual’s special condition. So, while choosing an asset, consider these options.
- How low the spread is: Larger spreads make it hard to earn profits. Such assets also have a high volatility rate.
- Active time: Make sure your chosen currency remains active during the time you want to enter the market.
- Behavior and understanding: You must choose the one that you understand the most, like how it fluctuates and how it might turn its direction.
- Volatility: The volatility of a specific asset has a great impact on the resulting profit. The impact can be of many folds. So, a person should be very careful before picking an asset.
Plan a Trading Strategy
The second step is to plan a viable trading strategy. Like the Forex market itself, nothing works as a constant factor here. Most things are variable, and so is a strategy. One method that plays a trader’s side might produce different results for another. One should adopt a method that makes sense to him. Visit the site of Saxo and learn more about the different trading style This will definitely help you to create a better plan.
Becoming articulate with the entire concept of the market phase is important. Market phases like foundation, consolidation, rise, and fall are crucial to understand for a trader. As it will help them fish in a deeper Forex market with bears and bulls and make a profit.
You also have to practice with three types of trades. They are
- Pullbacks, and
Start with how to identify them and the best ways to enter them. Forward to it, learn all details about the market conditions, and learn how to deal with them one by one thoroughly.
Familiarize Yourself with Different Charts
There are different analysis processes and instruments to help traders recognize various trends. Charts are the most important among all of them. You need to be able to notice areas on these charts where profitable opportunities emerge. Thus, you will also be able to pay more attention to market movements.
Here are some of the crucial things you need to identify on a chart
- Demand and supply levels (in a ranging market)
- Records of highs and lows
- Strong trends and their course
- Future swing points
Though the price movements by nature are not perfect, but still recognizing these elements on a chart will help step out of a trade before the situation gets worse.
If you have already started to trade a single currency pair following all the mentioned steps, now you have one more thing to maintain. And it is your consistency. Learn to stick to the plan or course of your goals.
At first, you must feel excited only to lose it dealing with too many trades. But don’t lose your courage and hold the path you have chosen. With time you will gather more confidence and know what works and what doesn’t in the long run.
So, these are the measures you need to take to execute one currency pair and to succeed. There are experienced traders who might guide you to walk a more complex road. But you should know that keeping it simple is the best way to deal with anything too complex, like the Forex market.