Ten Rules for a Profitable Forex Trading

Just like any human endeavor, there are certain "rules" that guide my Forex trading. They may not be applicable to everyone, but they did wonders to my Forex deals. Because of the immeasurable benefits I reaped out of following hard after them, I named them "The Ten Commandments for a Profitable Forex Trading."

1. Do not hesitate to trade the breakouts.

Technical analysis depend so much on chart patterns. So you have to be very well versed in the 5 basic chart formations - triangles, head and shoulder, double bottom, cup and handle, and triple bottom. As soon as you spot a breakout, trade it.

2. Do not forget the fundamentals.

You should always try to execute trades that are supported by the fundamentals and technicals. When you do just that, you increase your chance of winning in the trade.

3. Do not gamble.

Always remember that Forex trading is not like playing in a casino where you can do a "one-time, big-time" deal. Of course you can do that but be ready to find your account down to zero the next day. Gamblers have their place in casinos. If you want profit, be systematic in trading Forex.

4. Do not revenge trade.

Like many other deals, losing is part of the game. If you lose, just calm down and move on. Never hit the entry button again and trade twice or even thrice in the same position that you lost hoping you could get back and win. You will surely find yourself in a deep ditch once you lose again.

5. Manage your positions wisely.

Manage your positions wisely in the same manner that you manage your checks. Never risk more than 1% of your account balance in one trade.

6. Avoid trading in a highly volatile time.

Never trade during the release of high profile reports like the GDP. You cannot gauge how much a currency will move even with a report like that.

7. Trade on retracements.

If you missed a breakout or a strong, initial move in prices, don't just jump it. Wait for it to retrace so you can get a better price.

8. Be flexible.

The market is quite fickle minded. You just don't know what exactly the market wants. Sometimes it is best to adjust and be flexible.

9. Use a journal.

Journalizing helps you to keep track what's working and what's not in your trades. So you better jot them down.

10. Go out and unwind.

Forex trading is a tough job. It can become very straining. Sometimes you need to give yourself a break. Free yourself from stress. Clear your mind. Go out and unwind.

Jason Joaquin is an accountant and freelance business consultant. Currently, he is employed as Internal Audit Manager of a group of companies in southern Philippines.

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Forex Strategies - Maintain A Profitable Currency Trading Campaign With The Right Strategies

Every single successful trader says the same thing - to win at forex, you need a strategy. And truly winning at forex means much more than the latest robot that works for a few months then blows your account, true winning means making profits for years, taking losses sometimes of course, but year in, year out making consistent, reliable profits from the colossal finance market. So how can a budding trader benefit from a solid currency trading strategy?

The first thing to understand about forex strategies is that everyone trades them differently. Many new traders believe that a forex system will provide iron-clad rules which, by simply following them or even programming them, will guarantee wealth in a miraculously short timeframe. The reality is that if you backtest and trade even the very best forex strategies, they will almost always make at best a marginal profit. The endless crossing lines, averages, and technical wizardry of the hottest new indicators rarely bring longterm profits, and yet every profitable trader insists a strategy will make you win.

So why the need for a strategy? This is because there is an inherent irony involved in trading a forex system which everyone must eventually learn. If you give exactly the same rules to multiple different traders, and then have each trader keep those rules to the letter - everyone will still have completely different trading results. An experienced trader with thousands of hours of chart-reading experience will get good results from a mediocre strategy, yet a rookie trader with a great strategy may find success much more difficult. The main and all-important purpose of a forex strategy is not to create a magic system which instantly makes huge profits, rather it is to create a psychological framework to counteract the twin enemies of a forex trader, hope and fear.

Every successful trader is successful not because they have beat the market so much, but because they have beat themselves. Trading with emotion will ruin your profits, and the best way to beat that emotion is to have a rule-based, logical framework that overrides counter-productive emotional instinct. Strategy rules provide clear exit conditions to keep losing trades small and entry rules to identify high probability entry points with clear profit and loss targets. The seasoned trader will often not take every trade that their system provides, but rather within the possible trades offered by their system will then wait for the ones which, based on their experience and judgement, have the highest possible probability of winning.

In this way the you can eliminate emotion, defines clear entry, exit, profit and loss rules, utilizes their experience to cherry-pick the very best trades - and consistently makes money.

The arrival of different forex trading schemes makes the business very complicated today. That is why you should be able to develop a currency trading technique that is simply effective.

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Profitable Trading With Morning Break Out Strategies

A notable aspect as a result of the movement of various traded currency pairs in a Forex market is the probability of getting significant early morning breakouts. As a matter of fact, these early morning breakouts are increasingly profitable if spotted early by a Forex trader since they can take an equivalent long or short position all at once.

During the first half an hour of trading, take note of the highs and lows of trading. Traders go long when the price goes beyond the high recorded in the first 30 minutes. They also go short when the price goes below the low established in the first half an hour of trading. With morning break out strategy, Forex traders are able to trade these early morning break outs profitably.

The morning break out strategy looks to trade early morning breakouts during the early hours when the market has just opened at around 8:00 local time. This time is convenient because this the perfect time when best break outs occurs. In fact, the overnight trading session is characterized by small traded currency pairs since there are no major European or American traders actively involved in trading at that time. As a result, when major markets open the following day, the likelihood of break outs is high since major traders in the market are actively involved.

The secret behind morning break out strategy is looking on a daily basis for major pairs that have traded in the narrowest of range between the time when the major market opens at 8:00 and 12:00. Traders can determine this by keenly looking at the indicator on the daily chart that indicates the (ATR) average true range and having comparisons with the range recorded during overnight trading. For instance, lets say the average true range is 150 points and the traded currency pair moves between 30 to 40 points before the major markets opens, this scenario creates an opportunity to make high profit margins with a big move whichever the direction as soon as the markets open and the price goes against the trend of narrow trading range.

Though not all break outs turn out to be profitable breakouts, however there is always a high probability of most break outs proving lucrative. Rather than target huge points that have significant gains but difficult to achieve, it is better to target either 20 or 30 points since they are easily achievable but also profitable.

The use of morning break out strategies in the trade of early morning break outs in the Forex market is a profitable venture. Though early morning break outs do not appear on a daily basis due to the prospect of price fluctuation during overnight trading, however they present a lot of trading opportunities to traders in the Forex market.

Adam has been trading forex for 5 years and until recently with little success. Adam recently joined the World Forex Club and has since seen his profit margin quadruple in the past two years. Colin is a professional trader who shares his trading live, over a webinar three times a day 5 days a week, all you have do is copy what he does and take the profits. Since Adam joined Colin he has had the money to invest in other projects and gone on to be a successful full time forex trader and internet marketer.

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