Forex market is war. The most powerful weapon you can take this furious battle is a keen mind, fully loaded with knowledge. Here are 3 basic tips for investors new to the foreign exchange market, wants to expand their mental arsenal!
1. Create a personal trading journal. Write in this journal every trading day to record your trades, a brief explanation of what caused you to place the trade, and an assessment of that particular trade performance. Make notes about any upcoming major economic events or news that can cause market volatility for a particular day and avoid trading until you have a clearer picture of the day market action.
2. Determine your risk / reward ratio. A risk / reward ratio of 1:2 means that you can risk a certain amount to get at least double that amount in return, if everything goes according to plan.When you are new to FOREX, it is sometimes better to trade conservatively and use a very strict ratio closer to 1:1 and not risk more than 2-3% of your total capital per trade execution. In this struggle, survival everything. Read more
