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5 Golden Recommendations for Forex Traders

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5 Golden Recommendations for Forex Traders

If you are a successful forex trader, we would like to share our advice on risk management and account management as well as forecasting market direction. Here are forex advice in the gold value that you think will increase your chances of success in the case of your application;

  1. Use Stop Loss in your actions. If we make an analogy like this, we probably better explain the importance of using harm stopping; The damage is like a ride on a brake without brake. You will not have a problem on a straight road, but when you change direction you will get off the road, you will roll to the cliff. Stop the damage like your insurance. If you do not go as you expect in the market, protect your account from disaster.
  2. Do not risk more than 3%, maximum 5% of your total account in your transactions, and the risk of your total open transactions should not exceed 10%. Determine your severity by taking this risk management strategy into account according to your severity level. Let’s sample immediately; Assuming you have foreclosed with a $ 1000 account. Preferably 3%, so we will not risk more than $ 30 per transaction. How is it? Again, assuming that you are analyzing your forecasts and forecasting that EURUSD will rise, you have bought at 1.15. You have a very important support level of 1.1480, just below this support, and a level of 1.1470 as a loss stop. That’s 30 pips below entry level. In that case, we will open the transaction volume (lot) should not exceed 0.1. In EURUSD, a loss of 30 pips with a lot of 0.1 corresponds to a risk of $ 30. So your account is up to 3%. Of course, according to this account, if we judge that it is appropriate to put the damage stop below 60 pips of the entry level, we should decrease the amount of the lot we will open from 0.1 to 0.05.
  3. Your risk / return ratio should be at least 1/1. We mean; If we were to risk $ 30 in a transaction, we should expect at least $ 30 profit. Let’s continue with the example above; We bought EURUSD 0.10 lots at 1.15 level and set the level 1.1470 as loss stop. We should expect the parity to rise to at least 1.1530 in order to get profit. Or we should enter 1.1530 as the Take Profit level. Thus, you can only lose one transaction with a profit. This is one of the biggest mistakes investors make; To close the process with small profits while waiting for a long time while the processes are being aborted and closing with big losses.
  4. Set rational expectations and targets. Would you be surprised to find that large funds that manage billions of dollars have seen steady growth of 20% to 30% a year as a great success? This means that for an investor who invests $ 1000 in forex, it means a profit of $ 200-300 per year. Let’s say you entered a $ 1,000 investment on January 1, 2015, how satisfied are you with your account on December 31, 2015? 2000 grand? You fly so high. The annual $ 1,000 return may seem nominally low, but if you consider that you want to get this return with an investment of $ 1,000, remember that it is 100% annually. You are expecting 100% earnings while the funds that have huge research and analysis sections and managing billions are happy with 20% -30% … It did not seem like a very viable target.
  5. Understand it well; Even the biggest funds and the most professional investors in the world are hurt. Keep in mind that your analysis may be inaccurate, think about the cause of this loss after losses, read, follow, continue to trouble, work and develop yourself. Let’s give an example; Even 30-year forex hedge funds like FX Concepts are able to attract bankruptcy flags with false analysis and investments. Do not forget the saying ‘The market is always right’. Your goal should be to try to guess where the market will go, not fight or stubborn with it.

If you are following the above recommendations successfully, then you have taken a very big step towards achieving success with a bit of experience.

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