Useful Tips For Forex Beginners

[Guest FxNet]

Hello everyone,

For all the newbies out there, our team of experts at FxNet have written down some useful tips that can improve your day-to-day trading. Please see below:

Always put a Stop-Loss to your order

Trading without stop-loss is one of the most common and expensive mistakes of beginning traders. Always set a stop-loss to the amount you are willing to loose for every trade, otherwise you will see your account getting wiped out in a short period of time.

Always put a Take-Profit to your order

Not entering a take-profit can be just as dangerous as not entering a stop-loss. If you don’t enter profit targets and you just wait until it “feels” right to close the trade, then it can easily reverse and turn into a losing trade.

Don’t put too tight or too wide Stop-Loss

Depending on your trading style as well as your time of trading, you should always adjust the width of your SL accordingly. In general, during news trading your stop loss should be wide enough to absorb the market volatility and any spread widening that might occur. Trading news with stop loss of 10 pips is almost always a losing trade. During normal market conditions, you should use wider stop losses for longer timeframes and tighter for smaller timeframes.

Don’t risk too much of your capital at once

Another common mistake for new traders is risking too much capital on a single trade. In general, you shouldn’t risk more than 5% of your capital on a single trade. This way, you would have to have 20 consecutive losses your account to be wiped out.

Have a proper risk-reward ratio

Choosing a risk-reward ratio depends on your trading style, but it should never fall below 1:1. A 1:1 ratio means your stop-loss and take-profit is of the same width (for example 20 pips SL and 20 pips TP). In this case, you would need at least half of your trades to be successful in order to break even. A 1:2 ratio means your take profit is twice of stop loss (for example SL 20 pips and TP 40 pips). In this case you would need only one third of your trades to be successful.

Focus you attention on selective currency pairs

Don’t try to trade on a large amount of currency pairs. If you stick to a few pairs then you will better understand their characteristics by studying their history and you are more likely to predict their movement.

Trade with logic and analysis, not with emotion and hunches

Being a successful trader simply means increasing your probability to win than to lose. Trading without some basic technical analysis or a trading system is not much different than gambling. There are many ways to increase the probability for a trade to be successful. Knowing even the most basic tools of technical analysis and being able to spot buying and selling signals can greatly enhance your trading experience as well as your profits.

Best of luck and kind regards,

The FXNET Team.

[Guest Alfie]

Thanks for the sharing useful information I really like it. ^_^

[fxapex]

good advisory for a newbie....

[Guest Mateo Rodriguez]

Noted with big thanks, Thank you for sharing. Information are really helpful to new traders like me.

[hrishitasahay]

Forex market is very vast & before enter here we should aware about it, for the beginners should have to check some tips like-

make your goal perfectly.

Choose a broker with whom you feel relax for trading.

Collect all the information about the forex market before enter it.

Understand the graph and chart of the forex , will help you.

Subscribe weekly forex newsletter.

These are the few tips, will help in forex trading.

[stock_market]

Thanks for such a nice info,but i think it is not good decision to start your carrer in trading with currencies.

[sophiyawright35]

It is wonderful tips for forext marketor beginners thank a lot for given this advise

[marinelee]

The info regarding the forex exchange is very informative.

Act is if we want to earn good amount of retuns in forex then we need to examine forex trading.

[orni308]

Theses are some basic information that every trader have and should follow, but while trading most of the trader are so much nervous that they forgot about these stuff.

[dante]

dont scalp on your first live account. The complicated nature of these approaches means that rookie traders can get eaten alive, so only veteran traders with nerves of steel should consider playing the currency exchange market at any scale. unless you're know what you're doing scalping method are dangerous strategies to start out. perhaps many new traders willing to double their account overnight. the most important thing is, not all brokers are capable to handle scalping strategies, I've done these research for years among many brokers, and my last discovery are with Tickmill ECN account, it apprear give better result among other brokers I held with, while implementing exact same trading strategies (EA).