Most of the new traders love to use complex trading system. From the starting of their trading career, they rely on a complicated trading method and try to make big profits. But the pro-Aussie traders never relies on complex trading system. They love to trade the market with a simple technique. You might think a chart with tons of markings is the best form of market analysis. But in reality, such an approach always results in a big loss. You must understand the raw price movement and execute the trade based on the variable market condition.
There are many things you need to learn to improve your trading performance. In this article, we will discuss five creative steps followed by the pro traders in the Forex market.
The ideology of the market
Before you start executing real traders in the Forex market, you need to understand how this market works. Majority of the new traders make big mistakes since they don’t have any clear idea about the structure of this market. As a fulltime trader, you have to learn about the active participants of this market. You might get lost at the initial stage but there is nothing to worry. Start reading articles which clearly describe the basic details of this market. Spend a few months on creating a strong basic and this will help you a lot. Gather proper knowledge in the Forex market should be your first step towards the door of success.
Define your strategy
There are thousands of trading strategy available in the market. But you can’t make a profit by using other people trading system. Since trading strategy greatly depends on the trader’s mentality, it’s highly imperative you develop a balanced trading system by using the demo account. Once you have the perfect trading system, use the best Forex trading account offered by Saxo to execute the trade. Some of the novice traders might think they can create a perfect system in the real market. You might be a rich person but there is no reason to risk your real money in the testing phase. Take advantage of the demo account and try to craft a balanced trading strategy.
Choose your trading session
Very few traders understand the importance of the trading session. If you start trading the major currency pairs based on the trading session, you will notice a dramatic change in your trading result. Most of the time, the learners execute trades in the extreme or low volatile market. Eventually, they get bored by losing most of the trades. But if you start using the session period and chose the specific currency pair based on the fundamental data, you can find quality trades with an extreme level of ease.
Define the stop loss and take profit
Determining the stops and take profit plays a great role in your trading performance. You might be using the mental stops in trading but this will never work. Before you execute any trade, you must know the amount of money which you can afford to lose from that particular trade. In the case of taking profit, you need to use the nearest support and resistance level. But to get the best result from each trade, you need to set the stops and take profit based on the risk-reward ratio. Never trade this market with a 1:1 risk-reward ratio since it will make things harder in the investment industry.
Write down your weakness
You need to find the weakness in your trading system. Unless you know the weakness in your trading strategy, it will be hard to make the right decision at the complex market condition. You might say, there is no reason to follow a trading journal but this is the only way by which you can improve your trading performance. It will also help protect yours from overtrading the market. Keep things organized so that you can make a decent profit without having any stress.