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Yes, to add on what Leo said,
This is possible only when you trade following your trading plan. Before you close out your trade you can try to compare it with the other trades that have failed and hit your stops. If it shows the same features then you stand a small chance for your trade to succeed. You can also tell physically with your eyes once you are in the market that for sure a trade has failed.
If i can bring in a scenario, for instance. You set your stop loss basing on the previous support or resistance. If price reacts to that level and then successfully breaks out with a strong candlestick pattern in that direction, then you stand no chance before your stop is hit. Closing that trade will not only save you sometime to prepare for new opportunities but will also reduce on your expected loss.
Hello trader,
Your strategy has no problem at all and the market is not your enemy. the problem might be about how you set your stop loss levels and your target profit.
You either set your profit target too far to be hit or tight stop levels.
When you set tight stop loss levels close enough to your entry point, you suffocate your trades
When you set very large take profit targets, they are likely not to be hit.
Your risk to reward strategy for your trades should be good enough to cater for volatility and take profit should be achievable.You should also avoid setting your targets on support and resistance levels. these are known as market reversal levels. When you set a stop loss on a support or resistance level, price has higher chances of reversing than breaking through. Therefore your target is likely not to be hit and just reverses at the exact level.
How do you determine a lot size in Forex trading?
Lot size is determined depending mainly on the size of your account. This depends on how much money you start with as your capital deposit.
Forex accounts are grouped into different classes depending on the minimum amount required as a deposit.A lot simply refers to the number of units you can buy or sell in a trade or size of a trade you can place when trading. It can be a standard lot, mini lot, micro lot or nano.
A standard lot is equivalent to 100,000 units worth $10
A min account is equivalent to 10,000 units worth $1
A micro lot is equivalent to 1000 units worth $0.1
A nano account is equivalent to 100 units worth $0.01Forex quotes are always presented on Forex boards in Forex bureau exchanges. In the Forex market, they are provided by all brokers on the trading platform. The Forex quotes are not yours to determine so you not worry about that.
What is important is to know ,how to read these Forex quotes and their exchange rates so that you are able to make right decisions on which currency you should buy or sell.Forex quotes help to bring the comparison between different currency values. Currencies are presented and traded in pairs. The first currency is the base currency and is equivalent to 1 unit in value. The second currency in the pair is the quote/counter currency and is equivalent to that value 1 unit of the base currency is equivalent to; hence the exchange rate. You buy a currency when it appreciates in value and sell it when it falls in value.
some of the common currency pairs traded on the Forex market include, USD/JPY, USD/CAD, GBP/USD, EUR/JPY, EUR/USD, EU/RCAD, GBP/CAD, AUD/USD, NZD/USD, USD/CHF and many others.What are the appropriate strategies and recommendations of Forex Trading?
To me a strategy that is appropriate for Forex Trading is that one you have made yourself tested and you are sure it has all you need to trade.
What is a trading strategy?
This is a set of rules/guideline/procedures/methodology/habit you follow always every time you plan to trade.
I would recommend you make your own trading strategy. This way you are able to know what matches your trading style.
Your trading strategy involves rules and procedures; step by step, beginning with when you make decisions whether to take a trade or not, on when to trade, what you consider to take a trade, which setups to trade, when to enter trade and exit trade, your risk reward and so on.Your strategy should be well designed in a plan and you should make it appoint to trade only your plan. Trading discipline is a key in trading if you want your strategy to work.
Forex trading is the buying and selling of countries currencies.
It can be done in banks, forex bureaus, and online on the forex market through a broker.
To do forex trading, currencies must be traded in pairs. You buy one simultaneously selling the other depending on the represented economies or sell one simultaneously buying the other.
A trading plan guides you in the whole process of trading.
It contains your trading strategy, describes how your trading setups should look on the market chart.
It tells you when to enter a trade and when to get out.
It tells you which trading setup you should take and which you should not even if it has some of the qualities and why?
It tells the size you should use on an individual trade and why?
It tells you where you should put your stop loss in regard to take profit.
It tells you what to do in case a trade goes against your direction.It tells you what to do before taking a a trade, during and after closing a trade.
In conclusion a trading plan is a guideline to a trader. Without it you are likely to get confused in your journey of trading hence susceptible to big losses, account blowing, emotional trading and lack of self confidence and discipline.
Thanks for bringing up that topic Ravens,
A trading plan and trading by rules is one of the most important thing toward consistent trading but most challenging to most traders. I can personally say my first year of trading, it was not easy to bide by my trading plan rules and this costed my account a lot.
What should be included in a trading plan?
Before that,the most important is that, a trading plan should reflect who you are, your goals and your life as a trader.Before making a trading plan, you should know the kind of a trader you want to be.
How much time you can dedicate to forex trading. Level of commitment and Patience when holding a trade and your level of risk.What should be included in a trading plan?
Trading strategy,Entry point, exit point, time frame, risk management rules, dos and don’ts, decisions taken before, during and after taking a trade,what makes your strategy a failing trade and a trading journal.
How is a trading plan related to trading?
It provides guidelines to follow while trading.
Acts as a guiding map for the whole process of trading.
It tells you what to do, when to do it and how to do it?
It helps you to control the possibility of making big drawdowns hence protecting your account from big big losses.With a trading plan, you are able to trade emotionally free because you only follow the rules.
However keeping the rules is not easy but when you have learnt how, you will be able to profit consistently.
Hope this material has been helpful.
What do you consider when choosing a forex broker and how do i know he is not a scam?
Choosing a good broker is one of the most important things a look at first before i even think of starting to trade. why?
With a good broker, you will not be scammed or robbed your hard worked savings and more to that you will not meet issues of additional costs, big spreads and large slippages especially in times when there is news releases.
There are many brokers all over on line but the truth is some of these brokers are scams.
When choosing a broker, you have to be very careful. Do some due diligence and enough research before putting your money in the hands of a scammer and be sure that he/she is the right broker to deal with.
Some of the factors you should look at include; the broker’s reputation, level of convenience, easiness of their platform, if they are registered with the regulatory bodies and their associated costs.
Among others,this is a must, MUST CHOOSE A BROKER THAT IS REGISTERED WITH ANY OF THE REGULATORY BODIES. This can help you to file a compliant in case you find problems with that broker(like fraud and theft).
I hope this has been of help to you.
