Friday, September 7, 2007

Currency Trading Success - 10 Essential Trading Tips

If you want currency trading success and dont want to be one of the 90% of losers then the 10 tips below will help you.

1. Success comes from within

You cant buy advice from anyone one else it comes from within.

You need to be responsible for anything you do and keep in mind it is your efforts that will make you rich no one elses.

Forget the e-books and their fancy copy most of the authors have never even traded or failed brokers trying to make a fast buck.

2. Trade in isolation

Dont seek or give opinions, these will just upset your mental focus and let your emotions get in the way.

By trading in isolation you will stay disciplined and focused.

3. Use A simple trading method

Its a proven fact that simple methods work best and there is no correlation between how complicated a method is and how much money it makes.

In fact the opposite is true.

The more elements that you have in a system the more likely it is to break.

4. Trade with discipline

This is an obvious trait but most traders dont have it.

If you have a simple method you understand and have confidence in, you will be able to follow it with discipline through inevitable losing periods.

Many traders follow others, or systems they dont understand, confidence goes and they cant follow it with discipline.

If you cant follow a method with discipline you have no method in the first place.

5. Trade Longer Term

Day trading and intra day trading doest work, the logic is flawed and you have no chance of winning.

Use a longer term trend following system.

Currencies can show trends for months or years and this is where the profit is to be made.

6. Be patient

Many traders want to trade all time in case they miss a move, but this is pure gambling.

You need to be patient and trade only when the right trades present themselves in line with your methodology.

7. Have realistic Aims

Dont expect to get rich over night. If you could make 50 100% per annum you would make a lot of money over time.

Many traders have unrealistic aims, but it takes time to make money

8. Dont try to hard

Many traders think that the more effort they put into trading the more they will get out but this is not true.

There is no correlation between effort and reward in currency trading.

Your system can be devised in a week or two and trading should take no more than 30 minutes a day and you can see our other articles on how to do this

9. Manage risk

Currency trading is very risky, but unless you take a risk you wont get any reward.

What you need to do is take calculated risks when the odds are in your favor.

Accept risk as part of trading; never try and restrict risk so much that you have no chance of profit.

Many traders have simply no idea how to place stops.

Yet its one of the most critical elements of trading.

10. Know your edge

By this we mean:

What makes you think you have what it takes to join the 10% minority of winners?

If you dont know you dont have one!

Currency trading looks simple but few succeed and if you want to then the ten tips will help you.


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