10 Practical Tips for a Forex Trader

by Heather Johnson

Common sense is a required trait for a successful Forex trader. However, many investors will find themselves succumbing to their emotions, rather than using their head. Though you may think you're doing everything correctly, it is possible that you need a heavy dose of rational counsel. In fact, many of the following 10 practical tips should always be repeated in your head as you make each trade:

1. Practice with a Forex demo account before you start trading for the first time.

2. Use a trustworthy broker, one who can close out a position at a fair market price.

3. Manage your money wisely, even when you aren't trading.



4. Keep yourself as liquid as possible, reserving money in a savings account.

5. Always trade with a stop order.

6. Make a trading plan and stick to it – don't trade with your emotions.

7. Support each trade with sufficient evidence that it is the best thing to do. Don't compulsively trade just because you want to (aka "punting").

8. Stay on top the news. You don't want to be surprised with something at a bad time.

9. Prepare for illiquid periods, such as holidays.

10. Use a chart system that is right for you, one that you can completely understand.

Is there any earthshaking, original advice listed above? No, it's all standard stuff. However, it is also the kind of logic that many of us are subject to lose sight of at times. Be methodical in your trading. Otherwise, you might as well be putting your money into a slot machine and leaving everything up to chance.


------------
Heather Johnson is a freelance business, finance and economics writer, as well as a regular contributor at Business Credit Cards, a site for best business credit cards and best business credit cards offers. Heather welcomes comments and freelancing job inquiries at her email address heatherjohnson2323@gmail.com.

Published at Mar, 22 '08 ; read 551 times;

If you liked this article subscribe to the Free HYWD Newsletter

   

User comments:

Jamal Malik at May, 08 '08 06:34
Have you ever heard of a Forex managed account which allows potential investors periodic scheduled teleconferences with the traders? My clients PGF get to speak directly to the trader who manages FXCM accounts for them. Clients LOVE IT!!!!!!!!!!!
Reply to this comment

Now get syndicated content on all recently published or updated articles!

Or add to your favourite RSS readers: