The forex market is the liquid financial market globally. It is the biggest financial market in the world. Forex trading provides opportunities to earn profit due to fluctuation in currencies rate or other listed companies. Forex traders have been attracted because currency rates are changing rapidly. The forex market is a wired network of sellers of currency and buyers of currency. Some people also opt for futures trading as well because it offers better returns. Here are some rules which one needs to keep in mind when trading and some indicators which you should consider when investing in the futures trading platforms.
Dos
- Before starting the trading test demo account, start with a small amount.
- Record the history of each trade In detail.
- Plan the Trading and update regularly.
- Miss an opportunity if you are unsure.
- Update your knowledge about the fundamental and technical laws of Trading.
Don’t
- Don’t invest money in Trading if you don’t afford the loss.
- Don’t follow anyone’s instructions blindly, and signal providers are wrong in understanding market
- Your end goal is getting profit, don’t consider other things
- Don’t be extra-leverage.
- Don’t be frustrated if you are losing money in the trades.
Always check the Market Sentiment.
The accumulated thinking of the market trader is called market sentiment. If the majority of the market wants to sell currency, the sentiment is bearish; if the majority of the market wants to buy currency, the sentiment is bullish, and if the majority of the market is unsure what to do, then the sentiment is mixed. A forex trader should always keep an eye on market sentiment so that he earns a profit.
Trend Riding
Profit is earned by using trend riding techniques; before using trend riding techniques, we have to have a solid knowledge of trends. A Series of higher highs and higher lows in an uptrend and a series of lower highs and lower lows in a downtrend is called a trend. Mostly three trend directions are monitored.
- Uptrend
- Downtrend
- Sideways
You can easily find trends in the price chart of currency pairs. If EUR/USD is an uptrend, it means that EUR is rising higher than USD. If EUR/USD is a downtrend, it means that EUR is declining against USD, and if both currencies are in a narrow range, then the trend is sideways. Traders use trend riding techniques to earn more and more.
Fading breakout
If the support or resistance of the breakout is false and a breakout is unable to move in a forward direction, then you should fade this breakout. Fading of a breakout also depends on traders’ experience as well as market trends.
Breakout Trading
Technical analysis is required for breakout trading. Breakout trader looks at trend lines and prices pattern of currency and attempts to profit.
News straddling
Economic and geopolitical news is extremely important in Trading. Each news changes the mind of a forex trader. Therefore forex traders must update economic and geopolitical news from time to time to earn profit.