Some Tips to Succeed in Trading

[painofhell]

In general, people are interested in learning and becoming profitable traders. However, all beginners should think about recognizing the basics before actually getting started.

Indeed, new traders tend to appreciate these tips imagining that it provides a guarantee of definite and permanent success. That's why they want more to know how to set up their tables so they can hurry and make money.
But if we all would like to trade well, one of the relevant question would be:
What are the essential tips to ensure our success in trading?

To succeed in trading, you have to recognize that there is a set of rules to apply. These rules are so useful that we can be certain that they serve to guide all traders (whether experienced or not). This is reciprocal for any amount of investment. Each tip might be important, but when used properly, the effects are effective. Trading with these rules can significantly increase the chances of succeeding in the markets.

Therefore, in this article I want to present some tips that will guide you to the path of success.



Tip 1: Always use a trading plan.

A trading plan is a set of rules that specifies the entry and exit criteria of currency change. A plan is built to manage money in a trading account. Using a plan allows traders to trade better.With today's technology in demo accounts, it's easy to test a business idea before risking real money. It's good to try your plan.The test and application of business ideas through historical data, allow traders to determine if a trading plan is viable. It also shows how logic might be your plan.Once a plan has been developed and the test is performing well, the plan can then be used in a real account.And here, the key to success is to respect the plan.Opening currencies and trading out of your plan, even if they turn out to be wins, should be considered a risk, and destroy any expectation that the plan might have had.Let's follow our plan to succeed!


Tip 2: Treat trading like a standard business.

To be successful, you have to approach trading as a full-time or part-time business, and not as a hobby without following well-defined rules. And if you explain objectively, trading can be a frustrating job because there is no regular salary.Operating in trading is a business and it involves expenses, losses, taxes, uncertainty, stress and risks. As a trader, you are mainly an entrepreneur of your personal business, you must do your research and develop strategies to maximize the potential of your business.Also, it will be important to respect its time, and organize your workspace while following your plan as if it were your compass.


Tip 3: Use technology of platforms for your profits.

Trading is an intellectual activity. It can be assumed that the trader who focuses on mastering this science can take full advantage of the technology. Trading platforms have charts, maps, instruments, other tools with parameters and still indicators. The set allows traders to have an infinite variety of methods to visualize and analyze markets. These things help us get market updates and allow us to monitor currencies and assets anywhere.Thus, in a pragmatic sense, the use of platform technology can greatly improve the trader's performance. Use technology to your advantage and stay up to date with the technological advances available from a trusted broker. Dukascopy would be one of the best examples. This company offers its traders one of the best platform with various features that can contribute to the trader's advantage.


Tip 4: Protect your trading capital

Managing reasonably your money to finance a trading account can take a lot of time and effort.However, it is important to know that the protection of your trading capital is synonym of good management. All traders (whether expert or novice) have had losses. In general, this is part of trading. That's why we should not take unnecessary risks and let’s do everything we can to preserve our money.


Tip 5: Constantly study the market

Take Continuing Education - Traders need to focus on daily learning.Even if there is prior knowledge, it is important to learn about currency changes and observe their subtleties constantly. Concentration and observation allow traders to acquire instinct and learn nuances; this helps traders understand how these economic news affect the trading market.


Tip 6: Know the right time to trade

The two reasons why there are good times and bad times to trade in the forex or binary option are: 1. The first one is due to a distrustful trading plan. 2. The second is explained by weaknesses and bad methods of tradersThere are bigger losses because of the non-respect of the fundamental rules and the inefficiency of some traders. We must protect ourselves against the volatility of the markets because events remain different and are announced almost daily. We must therefore ensure that we are in a good time to trade better. Carefulness and attention are among the moral characteristics that a trader should have. So be careful! Similarly, it can be said that an imprudent trader is one who does not get informed about the currency pairs, stocks and other actors in the economy.Finally, external stressors, bad habits and the lack of physical activity can all contribute to this problem. A trader who is not in the best conditions for trading should think of taking a break to deal with personal problems, whether health or anything else that prevents the trader from being effective.

Tip 7: Practice trading with impartiality

Stay focused on the real Trading’s image. A loss should not surprise. This is a factor that is part of trading.Similarly, a win is one step on the way to success and profitability. It’s just the accumulated profits that make the difference.A trader must accept wins and losses in his business so that the emotions have less effect on his performance. This does not mean that we cannot be enthusiastic about a successful trade, but we must keep in mind that a trade in perdition is not inevitable.Setting realistic goals is essential for a reasonable practice in trading. That's why we should not expect to make huge returns with a small investment. A 10% return on a $ 100 account is very different from a 10% return on a $ 1,000 account. Let's work with what we have, and stay reasonable.

To sum up, it is good to understand each of these trading tips. You need to know how they work and how it can help traders succeed. Trading may seem difficult, but traders who have discipline and patience to follow these rules can increase their chances of success in this profitable area. With discipline, let's trade to receive profits!!!

After all, here is my quote for every traders:

Trading is like a game, but please create a perfect plan to succeed!

 

[painofhell]

Making Profits Consistently | the Simple Approach

The goal of a successful trader is to make the best trades. Money is secondary. – Alexander Elder
Hello, my dear friends and fellow community members.

1. INTRODUCTION
To make sure that we, the members of the Dukascopy Community are profitable each and every month I want to share with you an idea that if we put into practice then we will definitely be in profits at the end of each month. We have to find out a system, in which our stop loss and take profit is predefined. Also, we have to make sure that our take profit level is at least 3 times from the traded price as much as the stop loss is.

2. THE PLAN
We will put 1% of our account at risk on every trade. And we will aim for 3% of the account if we are right. To understand what I am talking about, we need to do a simple mathematics. Let us say that we took 10 trades in a month in this manner, where we risked 1% to gain 3%. And let us say that 5 trades were not in our favor. In other words, the stop-loss was triggered. The price hitting stop-loss 5 times means we have lost 5% of our entire capital(as we had 1% at risk on each trade and 1*5=5). At the same time out of 10, we have also won the five trades. Winning 5 trades mean that we have gained 15% on our entire capital(as we had targeted 3% per trade and 3*5=15). Doing the simple mathematics we can see that 15% minus 5% is equal to 10% net profit at the end of the month.

3. FINDING A TRADING SYSTEM
The next challenge is to find a trading system where the stop loss is less and the potential target is more. I have been trading for a very long time. I know such systems where the stop loss is less and the potential profit is much more. And yes, they are all trend following systems. Let us see these trend following systems one by one. To use these systems we need to know how to place the correct horizontal resistance lines and support line and the correct rising and falling trendlines.

4. TRADING FROM HORIZONTAL LEVELS

4.1 BREAK AND TEST OF THE HORIZONTAL LEVEL
If the price is trading below a horizontal resistance level and it breaks above this horizontal level then we need to keep an eye on this level as such levels which were good resistances in the past can become a very good support after they are broken. We need to see how the price reacts when it retraces back to this level from the top. If the price is supported by this line and a bullish candlestick appears such as a bullish engulfing or the bullish pinbar, then we need to place a buy order with stops loss just below that horizontal level and take profit target equal to the 3 times of the stop loss level.

PICTURE 1: BREAK AND TEST OF THE HORIZONTAL LEVEL

4.2 REJECTION FROM THE HORIZONTAL LEVEL
If the price is below a horizontal level and it is rejected by the horizontal level, then we need to see the candlestick formation. In this case like bearish pin bar or bearish engulfing will be formed at the horizontal level. This indicates that the price has failed to go above the horizontal level and it will fall in the near future. In such a scenario we will place a sell order at the close of the candle and place our stop loss above the horizontal level and take profit target equal to 3 times of the stop-loss level. The reverse is the process if the price is trading above the horizontal level.

PICTURE 2: REJECTION FROM THE HORIZONTAL LEVEL

5. TRADING THE TRENDLINES

5.1 TRADING THE RISING TRENDLINE
If the price is in an uptrend then it makes higher highs and higher lows. We have to draw a trendline joining the higher lows and wait for the price to touch this rising trend line and get rejected. If such thing happens then we need to buy the pair with a stop loss below the rising trend line and take profit target equal to the 3 times of the stop loss.

PICTURE 3: TRADING THE RISING TRENDLINE

5.2 TRADING THE FALLING TRENDLINE
If the price is in a downtrend then we have to draw a trend line joining the highs and wait for the price to touch this line and get rejected. If such thing happens then we need to sell the pair with a stop-loss above the falling trend line and take-profit target equal to see 3 times of the stop-loss. Now that we know which trade we are supposed to take, we should also take care that we don't take any trade other than this. Then only we can have 1:3 risk reward ratio. If we don't maintain this then our risk to reward ratio will be hampered and the results will not be as desired.PICTURE 4: TRADING THE FALLING TRENDLINE

6. DRAWING THE CORRECT LINES AND POSITION SIZING
Now that we know when we have to place a trade and when to get out, we just need to learn how to place the correct horizontal resistance lines and support line and the correct rising and falling trendlines. When everything is done we need to think how we will make sure that if the stop-loss is triggered then we will lose exactly 1% of the account and if we win then we gain exactly 3%. To make sure of this we need to calculate the position size as per the risk.

7. GOLDEN RULES OF TRADING
Following are the golden rules of trading. Why am I calling them the Golden rules? These are the golden rules because if you obey them then you will be profitable consistently.
If the risk to reward ratio is less than 1:3 don't take that trade.
Don't buy or sell more than recommended by the position size calculator
Place the trade only at the close of the candle.
Try to place the trade as close as possible to the support and resistance lines.

8. CONCLUSION
The beauty of this system is that even if you fail in your 7 out of 10 trades then also you will be profitable at the end of the 10 trades. Because if u fail 7 times you will lose 7% but if you win 3 times out of 10 then you will gain 9% because you are going to gain 3% on each trade(thanks to 1:3 risk to reward decided by us). In that case, 9 - 7 will be 2%. See we will still be profitable.Smile

But I assure you that if we draw our trendlines and the horizontal supports and resistances correctly then we will win more than 7 out of 10 trades. Don't focus on the profits but focus on the process. We want to trade only if there exists a possibility of getting 3 times return than the risk. That's all folks!!! Any comments and questions on this topic are welcome. Have a very profitable year ahead, I wish you all a very successful trading.