Forex is the name of a mysterious industry. People invest their money and only a few get to see the profit. Most of them lost their money in the market because they do not have the right idea. Many do not know that demo trading is necessary before you start trading in live trends. This article will not give you tips on how to improve your demo trading. We will only talk about the necessary things that you need to check before you place your first trades.
Forex trading is becoming extremely popular among the Singaporean traders. Many people often say trading is only for the experienced professionals. But if you don’t step into this industry how you will become experienced? You need to have the courage to start this profession. Many people say this profession is not suitable to live a high standard of life. But in reality, this is the only profession which can help you to secure your dream life.
Things are always very complex at the initial stage. But while you are trading CFDs, you have to consider the risk factors first. Forget about the potential reward for certain trade setups. You need to identify your risk tolerance level and based on that you need to set the lot size. Regardless of the quality of the trade setup, you can’t afford to risk more than 2% of your account at any trade.
Check the opening trends
The first that you need to check is the opening trends. You do not want to place your trade when the price has touched the sky and it will only come down. You want the price to be in your favor and when the entry is right, place your trades. Remember a right trend is very important for making a profit. You need to learn to trade with the trend. Whenever the trend is in favor, place your trades in favor of the trend. Never try to go against the trends of Forex. This is the first thing you should check on your every trades.
Set a small position
As this is your first trade, you do not want to set a big position. A big position size can empty your accounts without your knowledge. As you advance and develop your career, trade with bigger position sizes.
Have a backup plan
The back plan that we are referring to is the exit plan. You need to set an exit plan before you make the first trade. Remember the trade is going to live once you place your money. There is no way you can get back your investment without making a profit. Make a plan on how you will exit the market if the trends get volatile. They will get sometimes and you do not want your first live trade to be a tragedy. Set an exit plan and if possible, set stop-loss. This prevents the trade from going down further to empty your investment.
Wait and wait
Now you have placed your first live trade, you cannot do anything but wait. Wait for the time when the trend will overcome the spread and you will start making a profit. Do not get excited as it is the boring part that takes the most time. You can pass the time by analyzing the trends for your next trades or designing your strategy. Do not do anything and patiently wait. This is the time when your virtual trades begin transforming into money.
If you have made your profit, simply close the trades
Chances are you will not be that lucky but if you somehow manage to make your profit, exit the market instantly. You want to start your career with a win and not a loss. Try to follow these guidelines in placing your first trades and you will be more organized in the future. Stick to your routine and you will succeed.