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Follow the Risk management link below and learn more on how to set stop loss levels.
What are the appropriate strategies and recommendations of Forex Trading?
There are a variety of strategies available to trade Forex and one thing i must say for sure is that, all these strategies work. Depending on your personality, you should be able to choose a strategy that suits you well and that ,that matches your personality and master only that.
Your strategy should not be complicated and it should be able to win you some profits even after making 2 to 3 consecutive loses. It should have a winning rate which is 60% and above.
The strategy you should choose to trade should be able to generate atleast 3-5 setups when trading on smaller time frame or one when trading on a large time frame. What do i mean, your trading strategy should be able to generate setups on all time frames.
You should be able to plan for your trading strategy for instance; when to enter and exit trade, risk management strategies, decisions taken before and after taking a trade,how much you should risk per trade, how much size you use on each trade, how long should you hold a trade, which time frame should you trade.
Some of the strategies you can look into are heads and shoulders, double tops and bottoms, triangles, wedges, flags, pennants, harmonic patterns. These are some of the patterns that you can use to formulate a strategy to trade Forex. They are simple and easy to identify on the market chart. All you need is to master them and come up with a strategy that suits your trading personality.
I hope this has been helpful. Good luck trading.
How to determine Forex quotes?
Forex quotes refers to how currencies are presented in the Forex market. When you look at Forex quotes, you’ll notice that all currencies are quoted/presented in a pair – for example, EUR/USD, USD/CAD or USD/JPY. This is because when you buy a currency you are selling another one at the same time.
The first currency in the pair is known as the base currency and the second currency as the quote/counter currency. For example; USD/CAD; USD(base currency) and CAD(quote/counter currency). The second currency is called the quote because it is used to determine the value of the other in the pair.
lets see; the base currency is always equal to one unit. The second currency/quote currency gives the value of what one unit of the base currency is equal to.
like i said earlier, to trade currencies, you buy one simultaneously selling the other. So, if for instance you are to buy USD/CAD, you must know how many units of CAD you should sell to buy one unit of USD.
As a trader you will not be required to determine this because it is already calculated for you. This is exchange rate. What is important is to know when to buy and sell and must have a reason for doing so.
