When trading in a market that is as fast paced as Forex is, preventing substantial losses is just as important as coming out ahead. You need to have systems in place as a part of each plan that not only will maximize your gains, but will also minimize your losses if your trade does not go as you thought it would.
There are simple strategies you should employ in each trade to make that happen for you. Fixing buy and sell setups will help you to control your risk while increasing your profitability. They work by fixing when you will enter a trade, and when you will exit. Regardless of whether you are gaining or losing.
Why is This Important?
Buy and sell setups take the human element out of the trade. Before you invest your money, you choose the terms that expose you to the least amount risk as possible. Once the trade begins, for better or worse you sit back and let your money ride. Trading in this way helps you to control those decisions you would make based on your emotions, such as pulling out too soon when you have shown some gain, or staying in the trade too long in order to try and reverse a bad trade. Continue reading "Setting Up Your Forex Trade For Success With Stops and Limits"→
Traders who study their time frame charts religiously will learn how to pick out certain indicators that can help to forecast a trend. Identifying these indicators early will help you to get a jump start on entering and exiting a trade at just the right moment to maximize your profit.
A time frame chart is a simple method used by traders to get a clearer picture of the direction pairs are heading. You choose the length of time you want to study, say 2-hour increments for short term goals or 8-hour increments to study the long term trending of a pair. The chart will show you the averages during that time, smoothing out the variations to make it easier to see the important details you need to know.
Two of the tools that your moving averages will help you base trades off of are reversals and breakouts.
Trade management and discipline is an essential part of successful trading. It is easy to loose focus of your initial trading plan and make knee jerk decisions when you are in a position, but sticking to a proven plan is an easy way to control risk and trade consistently. Today we have invited Forex expert Casey Stubbs, a man with a trading plan, to share with you how he adds to a position. Be sure to comment with your own tips and visit Casey at Winners Edge Trading.
I have found that trade management is one of the most important tools a trader can use to improve their trading profitability.
There are many trade management techniques that may be implemented. For the scope of this training I am going to focus on adding to a position. The technique helps to leverage my trades for increased profits.