Forex trading is one of the most profitable professionals for those who know how to take advantage of market movements and consider all the necessary aspects to reduce losses. It is necessary to explain that not everything in trading is about analyzing charts, following trends and risk management, since many other factors can affect how much money you can make (or lose). On this occasion, we will talk about the top 3 Forex trading secrets to increase the chances of success.
What are the top 3 forex trading secrets?
There are 3 fundamental pillars that we have to take into account when trading Forex. If we don’t take these items seriously, we could end up losing a lot of money.
Choosing the right broker
As we all know, one of the things that will determine whether we are profitable with trading is our risk management. However, the high spread in some brokers makes it almost impossible to maintain a healthy risk-reward ratio because when positioning a trade, you already enter the market with a negative balance.
Suppose you want to trade EUR/USD and you try to risk 3% per trade to get 6% profit. If the real price of the pair is at 1.1822 and the broker makes you enter the trade at 1.1830, you are initiating a trade at 8 pips loss, which means that your stop loss has to be smaller than what you originally planned, putting at risk the operation and more than your 3% loss. Remember that we must have slack in our SL in case the price fluctuates a little and then it can go towards Take Profit.
For this reason, we recommend getting a broker with decent rates and minimal spreads to keep your trades safe, since otherwise it will be really difficult to be profitable.
Stick to a strategy that works
Look for a strategy that is supported by constant market movements, so that you can observe daily how it takes place and what is the perfect entry point, as in the case of breakouts. Sticking to a trading strategy that really works is one of the top 3 forex trading secrets because you ensure that you will maintain profitability by applying the same process, as long as it is correctly executed.
Modifying strategies is only good when you are using it poorly and want to improve your entry points, but inventing new strategies based only on observation can be very risky. It is advisable to stick to classic methods that still work (such as fibonacci or candlestick patterns) because they always repeat through all trends or fluctuations between ranges.
Stay updated with news
Although in markets like crypto where the news doesn’t really carry much weight in determining price direction, Forex is heavily affected by fundamentals.
A trader may be tracking the price of a currency pair to position a trade, but if at that particular moment news comes out that may affect the economic system or the productive apparatus of the nation to which one of the currencies belongs, we would be at the mercy of luck.
By not knowing exactly who benefits and who is harmed more on events like this, we cannot get used to trading certain news, although it is advisable to stay updated and take advantage of those that we know what effect they will have, such as waiting a long for USD if the economic performance of the United States increases considerably.
Once you know the top 3 forex trading secrets, it will be easier to see your numbers grow in your favor and increase the funds in your account. For more information on Forex trading, join Altsignals and stay tuned to our blog closely.
