How To Trade Blog: 2020

Thursday, December 31, 2020

How To Trade Forex & Win with Pin Bar Candlestick Pattern

As a special candlestick with many meanings in trading, Pin Bar is the name that always makes every trader study and learn when trading Forex. This article is for you – those who are looking for the most accurate and easy-to-understand approach to Pin Bar candlestick.

After reading this article, you will learn what Pin Bar candlestick is. You will also know the meaning and the most effective way to trade Forex with Pin Bar.

What is a Pin Bar candlestick in Forex?

When entering the financial market, the first thing you see is the Japanese candlestick chart. It has distinct shapes that reflect the price action of the market. And among them is a very different candlestick that looks like a pin – Pin Bar candlestick.

It is called Pin Bar because it looks like a pin. This candlestick has a prominent long wick, a small body, and with or without a small tail (Pin Bar nose).

Its characteristic

To confirm a candlestick is a Pin Bar in Forex, it must consist of the following characteristics:

– Tail (aka wick or shadow): The Pin Bar is a candlestick with a long upper or lower tail. That is the highlight of a Pin Bar candlesticks that show a strong rejection of prices. A Pin Bar must have a tail that is at least 2/3 of the length of the candlestick bar. The longer the tail is, the higher the accuracy of the Pin Bar is.

– Body: The zone between the opening and closing prices is called the candlestick body. The body should not exceed 1/3 of the candlestick length. Opening and closing prices are close to each other and may also be equal.

– Pin Bar nose: the opposite part of the tail. A Pin Bar does not necessarily need a nose. Sometimes, the Pin Bar doesn’t have a nose because it opens and closes right at the closing price of the candle. The smaller the Pin Bar nose is, the better it becomes.

– Pin Bar is a price signal indicating price rejection. From there, it shows that the possibility of a price reversal in the direction of the Pin Bar body is very high.

What is the characteristic of a Pin Bar?

Two common types of Pin Bar

There are two types of Pin Bar candlesticks that you need to pay attention to when they appear on the chart: Bullish Pin Bar and Bearish Pin Bar.

+ Bullish Pin Bar: This is a Pin Bar with a long downward tail and an upper body. They usually appear at the end of downtrends and serve as a warning signal for prices going up in the future. In addition, it may also appear in an uptrend as a signal of trend continuation.

The Bullish Pin Bar candlestick warns that the price may go up sharply

+ Bearish Pin Bar: This is a Pin Bar with a long upward tail and a lower body. They usually appear at the end of uptrends and serve as a warning signal for prices going down in the future. In addition, it may also appear in a downtrend as a signal of trend continuation.

The Bearish Pin Bar candlestick warns that the price may go down dramatically

How to trade Forex & Win with Pin Bar candlestick

Pin Bar itself is a very powerful price signal which is enough for you to open exact reversal orders in Forex. In this section, I will show you how to place Forex orders following this strategy. Here are the basic trading strategies for you to get acquainted with Pin Bar. In the following articles, I will bring you more advanced trading strategies.

Below are principles for trading Forex with Pin Bar candlesticks.

+ Bullish Pin Bar appears: Focus on opening a BUY order.

+ Bearish Pin Bar appears: Focus on opening a SELL order.

Open a BUY order in Forex with the Bullish Pin Bar candlestick as follows:

+ Entry Point: As soon as the price finishes creating a Bullish Pin Bar candlestick (green).

+ Stop-Loss: At the tail of the Bullish Pin Bar.

+ Take-Profit: when the price touches old resistance levels that have been formed in the past.

How to trade Forex & Win with Bullish Pin Bar candlestick

Open a SELL order in Forex with the Bearish Pin Bar candlestick as follows:

+ Entry Point: As soon as the price finishes creating a Bearish Pin Bar candlestick (red).

+ Stop-Loss: At the tail of the Bearish Pin Bar.

+ Take-Profit: when the price touches old support levels that have been formed in the past.

How to trade Forex & Win with Bearish Pin Bar candlestick

Notes when using this candlestick pattern

+ The longer the candle time period of the Pin Bar candlestick (Japanese candlesticks chart) is, the higher the accuracy becomes.

+ The shorter the nose is, the safer the Pin Bar becomes. Candlestick’s tails should be as long as possible. The body of the candle is short, lying completely on one side or the bottom of the candlestick bar.

+ To increase the accuracy of options, you should combine the Pin Bar with trend indicators. Open long trendy orders to achieve the highest level of accuracy.

There will be many more classic Forex trading strategies with Pin Bar candlesticks that will be introduced by me in the following articles. Pin Bar is a classic candlestick pattern that is part of the trading strategy of many successful traders. Get acquainted with this candlestick pattern today on a Demo account.

The post How To Trade Forex & Win with Pin Bar Candlestick Pattern appeared first on How To Trade Blog.

source https://howtotradeblog.com/how-to-trade-forex-win-with-pin-bar-candlestick-pattern/

Wednesday, December 30, 2020

How To Use 80/20 Rule or Pareto Principle In Forex Trading

The 80/20 rule is also called Pareto Principle (the law of the vital few, or the principle of factor sparsity). This principle “states” that in many events, approximately 80% of the effects come from 20% of the causes.

The origin of this rule was from the observation of population and wealth. Pareto noted that 20% of the Italian population owns 80% of the country’s assets. He then made statistics in many other countries and was surprised to see the same distribution. I will take one more funny example as follows. If you put the wealth of the 3 richest people in the world (Bill Gates + Buffet + Carlos Slim) together, we have a number equal to the total assets of the remaining 7 people in the list of the 10 richest people in the world.

The 80/20 principle is very common in finance, economics, sales, and other fields. So certainly, this rule can apply to our trading. Today, I will discuss it with you.

How do we apply the 80/20 rule in Forex trading?

With the 10-year observation of my teacher in the trading field, the 80/20 rule is not a “complete accuracy” according to science. But the meaning and efficiency that it brings about in every aspect of business are indisputable. This ratio should also be interpreted relatively. For example, we can also have 75/25, or 90/10, or even 99/1.

How many times have you heard this saying: “Only 10% of traders make money in the foreign exchange market, the remaining 90% are at a loss.”? An exact ratio between people who make money and those who lose money is hard to calculate. But I think this ratio ranges from 80/20 to 95/5.

Now the question is “Why is trading so difficult and why 80-90% of participants are losing money?”. I would like to offer my opinion as follows.

How do we apply the 80/20 rule in Forex trading?

Trading is a typical job for the saying “more is not better, less is better” or “simpler is better”. However, reality shows that it is difficult for us to follow these seemingly simple “instructions”.

– 80% of transactions should be simple and easy, only 20% should be more complicated.

– 80% of the profit comes from 20% of the opened orders.

– Regarding the time spent on the market, 80% is not for opening orders. The money-making opportunities appear in the market within only 20% of the time.

– For 80% of the time, you should not have any orders in a transaction. You should only do it for the remaining 20%.

– 80% of all orders are opened based on daily candlesticks. Only 20% are of other time frames (h1, h4, w1, etc.).

– 80% of the success in trading comes from trading psychology and balance management skills (risk/profit). 20% comes from the trading strategy and system.

Now we talk more about each above bullet. I will only go briefly because regarding all the issues below, I will write about them in detail in other articles.

80% simple – 20% complicated rule when trading Forex

This is quite simple. Most of our trading work is sitting in front of a computer and observing the price movement. This work is certainly not difficult. Identifying the market is not difficult. It is also not difficult to find opportunities to enter a trade. Only people complicate these things.

I pursue the trading method following trend, level and signal (TLS strategy) because it is simple (and also effective). You do not need to know about complicated indicators. For example, sitting and counting how many Elliott waves are there or trying to explain a variety of technical information, etc. Traders are often stuck in such complicated stuff. They quickly get tired, depressed, and give up.

80% simple - 20% complicated rule when trading Forex — 80% simple – 20% complicated rule when trading Forex

The difficult part about trading is to control yourself. Do not trade too much. Never risk too much on every order. Do not lose control of emotions and rush into the market after a big winning or losing order. In short, it’s to control your behavior and your mind. Along with balance management, they are considered to be the most difficult parts of trading.

Traders usually only spend 20% of their concentration time on this, while it should be 80%. I think that is also one of the most important reasons why they lose money.

80% of the profit comes from 20% of the transactions principle

I advise you should trade like a sniper. It means waiting patiently for a reasonable chance to pull the trigger. Focus on quality trading rather than quantity trading.

The fact is clear that the money I make comes from a very modest percentage of orders. My winning order usually earns me 2 to 3 times money than the money lost from a losing order.

This way, even if the number of losing orders exceeds that of the winning orders, I still earn a decent amount of money at the end of the year. It’s the secret of the 80/20 principle.

80% of the profit comes from 20% of the transactions principle rule — 80% of the profit comes from 20% of the transactions principle

For 80% of the time, I DO NOT trade – For the remaining 20%, I MAY trade

On average, I open about 4 orders a month. It is understandable because I am very careful when choosing to open an order. I think you should do it too. I don’t like venturing my hard-earned cash for something that is unclear and unobvious.

Most traders prefer the style of trading a lot and continuously. This makes them think that they will make money both more and faster. This leads to the situation that 80-90% of participants are losing money. They lose money because they trade too much.

Meanwhile, the opportunities that the market “gives” us are certainly not that many. They do not have enough patience and discipline to wait for a truly clear opportunity. If you have also been trading stock for years, sit back and watch over the years. How many profitable opportunities does the market give us a year? Or how many waves does a year have? The answer is a few times only.

For 80% of the time, I DO NOT trade - For the remaining 20%, I MAY trade principle/rule — For 80% of the time, I DO NOT trade. For the remaining 20%, I MAY trade

Do you see a correlation between the percentage of losing traders and the time without opportunities on the market? They are all around 80%. The market mainly fluctuates in a given (narrow) band. Most of the time, the price movement (up or down) brings no value to traders.

My mission is to analyze price movements, then stay patient and disciplined. I need to wait until the market really gives me the opportunity, rather than jump into an unclear market which fluctuates up and down in a narrow band. This is the most important point that I want to discuss in this article.

Don’t turn yourself into a drunk guy who throws money at betting on casinos. Remember that 80% of the time on the market is not for trading; only 20% of the time is appropriate for making a trade. If you think you’re trading 80% of the time, then stop, consider, think and change this habit. About 80% of that time, we spend on observation and “preying”.

80% of orders are based on daily charts (D1) – Only 20% are of other time charts

This is my favorite part of the 80/20 rule. The daily chart is my “weapon” of choice. 80% of my trades are based on daily candles.

I find that most traders trade with lower time frames (h4, h1, m30, etc.) and most of them are at a loss. People are attracted to quick movements or dancing numbers in low time frames. It creates an “addictive” impact, which makes traders constantly open orders. And that is why they lose money.

80% of orders are based on daily charts (D1) - Only 20% are of other time charts - 80/20 rule — 80% of orders are based on daily charts (D1) – Only 20% are of other time charts

80% of the success in trading comes from trading psychology and capital management skills. 20% comes from the trading strategy and method

This is another example of 80/20 principle. You should spend 80% of your time and energy on learning psychological control and capital management skills. For the remaining 20%, you can spend it on chart analysis and trading.

If you trust and persevere with this, I am confident that you will see significant changes in the way you trade. You will feel more secure, safer, more comfortable, and of course, make more money.

Many traders never realize this. The reason is that they go all in trying to find a strategy or a method to help them earn 1 million dollars in a short time. And if the current method does not help them earn money, they will find another method. That circle just keeps repeating.

80% win from trading psychology and capital management 20% from the trading strategy and method 80/20 principle — 80% win from trading psychology and capital management 20% from the trading strategy and method

In conclusion

Do you often review your transaction history?

I have saved all my trading history even from my first accounts. Yes, I have lots of accounts, lots of “dead” accounts.

Just take a look at those losing orders. How many orders did you open when you let your emotions overwhelm? How many orders did you open as if you were gambling a game of chance? Does it follow the 80/20 principle with 80% lose and only 20% win?

We can eliminate 80% of our losing orders by not letting emotions overwhelm our trading decisions, can’t we?

Focus your energy and mind on the things that earn you money (the 20%), not the other 80%. Work less, but smarter. What you need is a simple trading strategy and method. This is to eliminate the emotional effect as much as possible by not spending too much time (I only look at the chart a few times a day, and no more than 5 minutes each time).

P/S: Please don’t be impatient. I’m still trying to take the time to share everything I’ve learned with you here.

The post How To Use 80/20 Rule or Pareto Principle In Forex Trading appeared first on How To Trade Blog.

source https://howtotradeblog.com/how-to-use-80-20-rule-pareto-principle-forex-trading/

Monday, December 28, 2020

How To Trade Forex With Minimalist Style

I’m sure that many of you have heard about the “minimalist”. We have “minimalist” in trading, in lifestyle, in fashion (those believers wearing only one color, usually black or white), in design (for example, Apple products), etc. I think it is a current and future trend for people, where we refine what is best, most basic, most important. And this article will discuss how we use this style to trade Forex.

Personally, I have a simple life (and I’m very happy with that now. Regarding the future, not to tell in advance), and my trading style is also the same. The way I approach and the way I trade in the market is very simple. And if you think about the benefits of minimalism from life to trading, you will find them great.

With a minimalist life, you can save money by not buying miscellaneous and unnecessary things. You can also save time by eliminating unnecessary problems in life so you can have more time to spend with your family or personal interests, etc. Or you can even eliminate stress (owning fewer things makes your mind lighter and more peaceful) and gain many other benefits.

Trading is the same. You may have to sit for hours in front of a computer screen, look at a series of charts, strain your eyes with fluctuations, ache your head with reading and translating news, etc. But if you don’t want to, then this article is for you. In fact, large offices in a prime location, a series of computers and monitors, general information purchased with money, etc., are not necessary. You will not need them to become a successful trader.

Big things are not necessarily good when we trade Forex

As a first step, you need to forget the perspective of the (seemingly) professional traders. They are a large office, a large wooden table, a series of computer screens, the latest and most modern trading software or robots, etc. All you need is just ONE laptop with a free trading software (such as Metatrader 4), an effective trading strategy, and your brain.

The perspective of “professional traders” has always fascinated us, truly. These are expensive suits, gorgeous offices, big screens with technical lines, etc. They all make everything “seem” to earn a lot of money. But do they really earn a lot of money? Some people do and some people don’t.

However, there is just one thing I want to talk about. I want to be a guy sitting in my favorite coffee shop, wearing whatever clothes which make me comfortable and stylish, looking at the hustle and bustle on the street with a laptop in the front, and of course, trading – making money.

Get rid of the unnecessary and focus more if you are looking to learn and succeed with trading. If you are a little bit ostentatious and monumental, that’s okay, each of us has a living style. However, do it after you succeed with trading and understand how to make money from this market.

If you are still new, I think that you do not need to invest so much in such things. For your information, many of the top personal traders trade with only one laptop. Mr. Buffett maintains his habit of reading paper reports. He hardly uses a computer and many myths among investors often have the same style.

Personally, I used to trade Forex in monumental offices with lots of screens surrounding. But now, I make friends with a computer, sometimes a smartphone to monitor the market and decide whether to open orders or not. I find that I trade much better than before.

Have you ever thought of trying? Most of us do not take forex trading as a real career. We often come across this market and give it a try to make money from it. Then this minimalist trading style is definitely perfect for you.

Minimize what you put in the chart to maximize the trading results

We can agree on one thing: most traders lose money because they make emotional mistakes during trading (such as greed, fear, excessive hope, etc.). A trading chart with lots of technical lines plays a big part in your failure. This is like the psychology of buying more things will make you feel happier. We often have the mentality that more technical indicators will help us capture more information, and become more successful.

Do you often read about Buddhism? One of the biggest secrets to succeed in all fields of life and to pursue happiness is “the less, the better”. When we have fewer things to worry about in life, we will bear less hassle. Meanwhile, our minds will be more lucid and serene. We will become a better person, and certainly, a better trader.

Minimize what you put in the chart to maximize the trading results

Traders always think that: when they lose money, it is because their strategies and methods are not correct. After that, they will find a new “perfect” method by adding dozens of technical indicators and continue to trade Forex. They will supplement everything which makes them feel more secure. This definitely gives them greater peace of mind. But then, the time will make them realize that nothing has changed. They will still lose their money for Mr. Market. In my opinion, the key here is: more is NOT better.

You can see that trading psychology is the most important factor. Your strategies and methods are mainly based on your own trading psychology. When we trade with 10 indicator lines on the chart, we will feel confusion, contradiction, and frustration. These will lead to unreasonable orders in which you are overwhelmed by a series of emotions. And often, this is when we lose money.

Therefore, before adding any technical indicators to your chart, ask yourself: Do you really need it? Will it really help you? You should only trade with what you really need.

How to trade Forex with minimalist style

– Abandon as much as possible the indicators of the foreign exchange market, the complex robots. Use a simple chart with prices (Japanese candlesticks) as main. This helps you stay calm and focused when observing the market.

– Learn how to trade Forex with trend, levels and signal (TLS strategy). After eliminating unnecessary technical indicators, you need to learn how to trade with Japanese candlesticks. I believe this is the easiest, simplest method for you to observe and trade on the market.

– After learning about TLS strategy, you need to understand that it is not necessary to sit and watch the market all day. You can learn how to trade at the end of the day (meaning the end of the US trading session) which will suit your main job.

How to trade Forex with minimalist style

– Forget about trading with all currency pairs. Minimize and focus on your favorite pairs, plus the oil and gold markets. Do you remember what Bruce Lee said? “I fear not the man who has practiced 10,000 kicks once, but I fear the man who has practiced one kick 10,000 times.”

– Don’t worry about your forex trading room, computers and monitors, long tables, extremely detailed data purchased with cash, etc. In fact, you don’t necessarily need them. They are good things, of course, but you do NOT have to own them to make money in this market.

– Make sure your trading place is always clean, airy, and simple. Whether you trade Forex at home or at a coffee shop, keep things simple. You do not need dozens of trading books around, you just need a few reliable and useful addresses to learn (I hope this small blog is one of them).

Summary

We humans often like to store, with the psychology of “as much as possible” or “better late than never”. In fact, when we make more money, we spend more and store more. However, most of them are NOT REALLY necessary. We are caught in the cycle of consumers and the demand aka the desire for material possessions.

In my opinion, you can absolutely live a life of less anxiety, more serene without carrying too many unnecessary things. Trading is also similar.

The post How To Trade Forex With Minimalist Style appeared first on How To Trade Blog.

source https://howtotradeblog.com/how-to-trade-forex-minimalist-style/

Sunday, December 27, 2020

Fixed Time Trades – The Perfect Speed Trap That Brokers Set Out For You

Hello, all of you. Today, we will sit down and discuss a little bit about Fixed Time Trades (FTT). This is a new, negative but seemingly correct, view of this trading type. This article presents my point of view – Flash. I’m a trader who has been bullied by the market for over 3 years. I hope it will be useful to all those who have been and will be, embarking on this path.

The truth about Fixed Time Trades

There is a quote that I read somewhere (sorry I don’t remember the source): Actually, FTT brokers do not need to manipulate the price (manipulate candlestick signals) or tricks to mutilate your money. Just give traders a chance to trade a lot and quickly, they will burn out their own accounts at once.

I do not deny the fact that there are a fair number of brokers that show signs of fraud. They manipulate the price or do other tricks to prevent traders from making a profit or withdrawing when being profitable. However, “genuine” platforms will never interfere with your order. They are even better by interfering with your mind. They stimulate it and let it do the rest.

"Genuine" platforms will never interfere with your order — “Genuine” platforms will never interfere with your order

What did brokers do?

The nature of Fixed Time Trade is not about speed. It’s the problem of correct and incorrect with severe win rates. However, brokers wisely recognized the problem. They need to increase the speed of trading to beat both the good traders and fools.

Admittedly, for whoever creates Fixed Time Trades, they are the ones who understand the traders’ world very well. They understand that speed is the life-and-death key to this profession.

In Fixed Time Trades, things go wildly but as planned. Ironically, you are the wild things, and the platform is the one who plans to let you pour money into their pockets. It’s a game that is inherently fair (in theory) but extremely sophisticated mentally.

Prepare for the game

First, they give you the right to enter and close an order after as long as 30 seconds or just seconds. This alone is enough for you to kill yourself. Then, there are dozens of currency pairs (including those that even Forex traders do not want to get involved in), and dozens of available indicators.

That’s how the brokers become innocent. They don’t put their hands in your pockets to steal the money! They even give you a nice and great gun with loaded bullets. It is you who hold the gun to your head and pull the trigger.

In Fixed Time Trades, it is you who hold the gun to your head and pull the trigger

That is the speed trap of Fixed Time Trades

In that spiral, the first hard thing is you have to be sure of the order closing point. A freaking retest can also cause losses. The next hard thing is speed. Brokers offer us orders that last only a few minutes or even seconds. We think that it is “the privilege to make a quick profit”. But no, it is actually “the right to regularly pay money to the floor”.

Platforms offer you access to a motorbike with hundreds of cubic centimeters that will make you fall off the cliff

Once again, I will repeat the quote at the beginning of the article. A reputable broker has nothing to do with fraud or tricks. You may be no more than a kindergarten kid in the middle of the trading battlefield. Platforms offer you access to a motorbike with hundreds of cubic centimeters that will make you fall off the cliff. Your fall-off will be even better than the action in Hollywood blockbusters.

So which is the right approach to Fixed Time Trades?

The speed trap is an intentional tactic of brokers. If you are serious about trying it out, make sure you understand this.

What should we do? I will repeat a few chants which have never been never redundant:

Discipline, discipline, and discipline. I often say this to my trading friends: Win within the scenario and lose within the plan. That plan is the amount of loss you allow yourself to lose on every trade, every session, or every day. And ABSOLUTELY DO NOT EXCEED THAT.

– Always be on guard. The market has to go along with your scenario, creating the right system conditions. If it isn’t for the condition, it is the market that lets you down. Take your finger off the mouse! This habit both makes you not confused about your knowledge and cools your mind down a lot.

– Aim for orders with larger time frames (although most platforms do not offer a high profit rate when trading with large time frames). Personally, I’m still trading on the M5 frame. But I had to force myself with the 15-minute time frame on my DEMO account for quite a long time to cool my head down.

This is my view on Fixed Time Trades. And you, what do you want to share? Let’s talk about it in the comment section. Goodbye and good luck.

The post Fixed Time Trades – The Perfect Speed Trap That Brokers Set Out For You appeared first on How To Trade Blog.

source https://howtotradeblog.com/fixed-time-trades/

Friday, December 25, 2020

How To Build Your Own Forex Trading Room

In the long run, if you are serious about forex trading, you need a separate space and room for trading.

The surroundings bring direct effects on your mind and emotions. And they are the factors that have a great (or even strongest) impact on the transaction.

Each trader has a different living situation and economic status leading to where they conduct trading is also very different. But overall, you need to design a workplace that harmonizes two elements: high practical applicability and comfort.

In this article, I would like to share with you how to build a working “office” to yield the highest efficiency.

Support equipment for a trading room

This is clearly one of the most important. If any room in your home is comfortable, buy a large computer desk. The L-shaped table is probably the most suitable choice. Shop as many screens as possible. We may only need one computer case, but using multiple monitors is still good.

For those of you who don’t have a lot of space, you also need at least a desk where you can fit your laptop.

For those of you who don’t even have enough room for a small table, buy a laptop cooling base and use it wherever possible.

Besides a table, you will also need a chair. Regarding chairs, I recommend that you definitely spend a remarkable amount of money to buy a really good chair. Chairs should be made of soft leather on which you can recline and sit comfortably. You need to be always in a comfortable state (both physically and mentally) to get a good trade. And a chair plays a big part in this.

Important things to remember: a clean and tidy space helps cultivate a neat and focused mind. You need it for trading and learning from the market. So when considering anything in the room, always ask yourself if it’s tidy or if it distracts you. Remember that trading is a real business. We focus on working, not wandering.

Computers and laptops

Computers and laptops are getting cheaper day by day. When I was a freshman at university, I bought an HP laptop with fingerprint recognition specialized for business, for more than $900. It was a lot of money back then. Its configurations were only core 2 duo, 500gb, 2gb ram. But back then that was the best. Nowadays, you can afford a laptop that is 4 times more powerful and 3 times cheaper. So don’t be stingy, buy a healthy computer.

There are many options when you use one or more computers to conduct your transactions. However, we will also have some basic points that you should focus on.

First, we need a modern and sufficiently powerful computer in your trading room. It is easy to get frustrated if the computer hangs, freezes, or suddenly reboots, etc. We need a computer that works smoothly and safely.

When it comes to security, you need good antivirus software. You can pay a little for a license key. However, if you want to save a bit, please google. Free keys are shared a lot on the internet.

Investing in computers and laptops — Investing in a good computer and laptop

Ideally – in my opinion, you need to own 1 desktop and 1 laptop. If the power is unfortunately lost (have you ever thought about this?), you can still monitor the market and your orders using a laptop with a 4G sim card that can connect you to the internet.

The laptop helps you become very mobile and proactive in trading when you’re out of your room. You can take it wherever you want. For more carefully, you can buy a backup charger for laptops. Whether you are using Windows or Mac OS, you can easily buy a compact charger.

Monitors

If you can afford more than one computer monitor, invest bravely.

With multiple monitors, you can track charts, information, etc., more easily and quickly. This is not a required option. If you don’t have enough money to invest in this, one monitor will be enough.

Be careful because too many monitors may reduce your concentration. Perhaps with a series of intricate charts, these screens may confuse your mind with the information. This leads to bad influence on trading.

Internet and TV packages

Trading depends heavily on information and data. Surely what we need is a stable and then fast internet connection.

You need to put stability first. You can not trade with an internet connection that goes offline several times a week and takes a long time to repair. Trading foreign exchange does not require you to have an internet connection which is too fast. Some people I know have also installed another network for backup. If it is affordable, you can follow it. But for me, it is not necessary.

Internet and TV packages are important for Forex trading in your room

We do not need to use paid information services. Most important information is available and free on the internet and television. You only need a television (no need too good) with some financial channels available in the room.

Office supplies

What you should have is a whiteboard and a marker pen that can be easily cleaned. You can write on it your trading plan, things to keep in mind, ideas that pop up in your mind, etc.

Yellow sticky notes are also things you should have. It helps you quickly write down your own ideas, record your own “trading rules”, or just some famous words, etc. I also have many sticky notes, some of which look like: “Focus”, “Let the winner RUN”, “Sniper”, etc.

Notebooks, transaction diaries, pens, etc., of course, are all necessary items for your trading room.

Creating a suitable atmosphere and style for your trading room

Most traders do not pay attention to their surroundings. In fact, it is very important. Perhaps just like me, we trade at home, and that helps us decorate and arrange things as we wish. The thing is to create a comfortable and pleasant atmosphere (which contributes greatly to our success in trading).

The trading room should be the quietest place in the house which stays away from the noisy and annoying things. You can hang in the room inspiring pictures, such as portraits of Warren Buffett, George Soros, etc., or paintings of peaceful people or scenery. These things will help you calm down and be more inspired.

Creating a suitable atmosphere and style for your room

You can also listen to soothing classical music if that makes you more comfortable. I don’t think dance music, hip-hop music, or house music are suitable for this.

Other stuff

Always remember that your health is the most important. You cannot trade effectively without sleep, substance, or inactivity.

Pay attention to resting, to meals full of nutrients, to gym sessions, or to walking and biking. If possible, invest in an exercise package at centers. There, they have a bathroom, a sauna, a full set of work-out machines and the price is not very expensive. Investing in health is always the best investment so don’t think too much.

You can’t control the market, but you can control your mind and good habits (yes, I know it’s hard to do). If you want to succeed, you need a good brain. And a good brain needs a healthy body.

If you want to succeed, you need a good brain. And a good brain needs a healthy body

Summary

Finally, Forex trading is a battle of your own. Be well prepared and work hard.

I wish you lots of luck.

P/S: For me, this is the first step of “apprenticeship”. When you have certain experiences and skills, trade in a simplified way to save your time, and improve your health.

The post How To Build Your Own Forex Trading Room appeared first on How To Trade Blog.

source https://howtotradeblog.com/how-to-build-forex-trading-room/

Thursday, December 24, 2020

Why Should We Consider Forex Trading As A Real Career?

Have you ever consider Forex trading as a serious job with a real career?

Sometimes I still wonder why do people often use the saying “playing stock” or “playing forex”? Do they consider stock trading to be more like a game of chance? Winning is god giving, and losing is just gambling, isn’t it?

That’s why I am of no surprise that most traders lose their money, even a lot of money. Only 10-20% of the participants are winning (earning money).

One of the biggest mistakes of foreign exchange traders make is that they don’t consider it a serious business. Many people who I know even consider it a game of chance or a journey to the casino. Instead of staying calm and calculating carefully, they act like a moth to the flame of gambling.

Please don't see Forex trading as a game of gambling — Please don’t see Forex trading as a game of gambling

If you really want to succeed with Forex, you need to seriously consider it as a real trading career. Work properly, by the fact that Forex is exactly a top-notch business.

Like many other businesses out there, Forex has many “costs”. The goal of a trader like you and me is to bring in more revenue (winning orders) than the cost. That’s when we are profitable. If you leave these costs out of control, you will lose money. And with that, your Forex business will also go downhill (burn out your balance, lose all your money).

What are the costs of the Forex market?

Your costs as a trader include lost orders, platform brokerage fees, and spreads for opening orders, computers, laptops, electronics, and office equipment, etc. No matter how hard you try to cut down or save, there are still things you must spend before thinking of making a profit. They are the biggest costs, especially from lost orders, for a trader.

Sadly, a lot of people think that trading is like a journey to the casino. They imagine perfect perspectives, where you always win with huge amounts of money. They should have thought about losing money before thinking of making money (risk management).

In fact, when you trade, you always encounter lost orders. You need to know that there are many professional traders whose win rate is only equal or even lower than their loss rate. However, they all make a lot of money. The important thing is when you win, how much you win, and when you lose, how much you lose?

Here, I will list out the costs for you once again.

– Lost orders.

– Brokerage fees.

– Computers, laptops (hardware).

– Software.

– Other office equipment.

Those are your main and most expensive costs which you cannot cut down. Your goal is to make the money earned from the winning orders, after deducting all the above costs, still to be “a few dollars”.

So how to make Forex trading profitable?

In this article, I will only outline the key points. Regarding the details, I will write into different articles. These are the points that I personally think are the most important to help us earn profits in Forex trading.

As I said above, our goal is to maximize the amount of money we earn from winning orders. This is to offset the costs before you can bring your profit home. Basically, we have the following two choices:

The ratio of winning orders is much higher than that of losing orders.
The amount earned from winning order(s) is much more than the amount lost from losing order(s).

Most experienced traders agree that the second choice is “easier” than the first. What we mention here is the risk/reward ratio (Please note that the risk comes before the reward).

If we determine this ratio to be 1:2 for all orders, we only need a winning ratio of 35-40% to achieve a relative profit.

Professional traders who can be referred to as successful, are not the ones with extremely high win rates (like 70-80%). Usually, their winning rate is just about 40-60%. But they make sure that the amount of money earned from winning orders is much greater than the amount lost from losing orders. In this way, they will reduce the pressure of having to win a lot but they still make money, even a lot of money.

We don’t have to go from-win-to-win. We can lose more than win but with a good management strategy, we are still winners.

What is the difference between Forex business and others?

For other businesses, your work is to explore the market, learn skills, or provide/develop a product. Then, develop those skills and products until they are better than most of the same products available. That will bring you the money.

Trading here is likewise – a business. If you want financial assurance, you also have to go sleepless or even drop blood for it, like a true businessman. You need to learn to be patient, focused, disciplined and dedicated. You also need to work hard, be passionate, and fully control yourself as well as your set business plan.

What is the difference between Forex business and others?

In the Foreign exchange market – Forex trading, you cannot control or manipulate the market. To be successful, all you can do is find out what’s going on. Is it the right time to make your transaction?

You, certainly, can never depend on advice from others, or random fortunes to succeed in this market. Certainly, you cannot build a fully automated system that lets you free and automatically earns money for you.

You need to be constantly learning, cultivating, and developing until you have a trading strategy which you can trust. And even if this strategy brings you success and money, you still need to monitor and develop it day by day.

How to build your Forex trading career?

Successful traders understand the key point of their trading career. It is about building trading skills, not relying on advice from others, or some accidental fortunes.

When you have your own trading rules, which are right and comfortable for you, you just have to keep developing them. This helps you eliminate stress and anxiety when trading, making it a light and fun career. Trading can become something very interesting and pleasant when you believe in the rules and systems set by yourself.

Once you achieve those things, focus, and trust them. Do not “ask every passerby how to build your house” in finding the strategies that sound good. Just stick to your own strategy and look for the opportunities it brings.

So believe in yourself and consider Forex trading as a real career. That’s how you start your trading path.

The post Why Should We Consider Forex Trading As A Real Career? appeared first on How To Trade Blog.

source https://howtotradeblog.com/real-forex-trading-career/