We have all herd the forex buzz in the past few years, thousands of beginner currency traders come into the market every month with the sure opinion that they will master the market and make millions. We all know how that ends up.
Forex Currency Trading For The Beginer does not have to be complicated at all in fact you will probably be shocked when I tell you what some traders I know are doing to make millions!
The first thing you need to get started is an online forex broker account you can easily and quickly make your trades from where ever you are in the world. Don't just settle for the first broker you come across check each one out and weigh up the pros and cons of each before making a decision. Most brokers now will allow you to trade in micro lots which is perfect for beginners, you can fund your account with as little as $100 to get started. Your account will have at least 100% margin which means you can control $10,000 with the $100 in your account.
All brokers have there own charting platform, don't get caught up in all the fancy indicators they will only confuse you. Remember we want to keep this simple!
Setting up your trading account should take 2-3 days in the mean time you need to start thinking about your trading system.
A trading system is simply a set of rules to get you in and out of trades. I am now going to outline a simple system which I know to be very profitable and perfect for a beginner who is new to currency trading.
First you will need to pick on currency pair, mine is the EURUSD you are only going to trade one pair. Get to know that pair and how it moves (this comes in time).
You will be using a 4 hour chart. The first thing you need to do is see what the trend is so zoom out a little until you can see at least 2 months of data now if the chart starts in the bottom corner and finishes in the top it is a up trend and if it starts at the top and finishes at the bottom it is a down trend.
We are only taking trades with the trend. Look at the current move is it with the trend if so wait for a retracement. Use the 50% retracement level and look for a support/resistance level that is in confluence with it.
Take your trade at this level with a 50 pip trailing stop never risking more than 3% of your account on each trade.
Here is the part that is really important to your success! When you have 100pips profit add to your position by half the amount of your original position. Keep looking for retracements to add to your position every 50 pips as it increases in profit. Never cut a winning position off until you have a good reason to believe it is over. You will not get good runs over a 100 pips all the time but they do happen at least once a month and when they do you will see the power of this simple system. During the time when you don't have huge moves your 50 pip trailing stop will usually take you out with a small profit.
That is all there is to it. Simple but it works very well and is perfect for the forex currency trading beginner.
0 comments:
Post a Comment