When most people think of making money they think of owning stocks or real estate.
There is a better and faster way to make money through trading foreign currency. I bet you don’t know anyone that trades currency for a living since few people do.
The reality is that once you develop the knowledge and learn the trading software the sky is the limit.
Few people realize that more money is traded in foreign currency daily than all of the worldwide stock markets combined.
It is a huge market that is open 24 hours a day. You can trade any time you like and from anywhere in the world.
The following tips are basic but crucial if you want to become a millionaire trading currency.
1. Practice Trading First – Before you invest a dime of your own money you should practice currency trading. Every trading software is different and needs to be practiced until you feel comfortable using it. A good trading system that you can practice and then use for real trading is here.
2. The Trend is Your Friend – When the market is moving higher trade like its moving higher. When the market is falling take your money off the table. Too many traders try to fight the trend and they end up paying the price with a lower account value.
3. Trade Without Emotions – Too many people trade with their emotion which is the worse thing you can do. When your money is increasing you want to sell to lock in profits, when your losing money you want to bury your head and not look. The answer is to trade with specific tactics, buy and sell within tight ranges.
4. Risk No More than 5% – Whenever you hold a position never trade with more than 5% of your account value. No one is right much more than half the time so don’t risk a large amount of your cash on any single trade.
5. Limit Your Losses – The worst thing you can do is not close out a losing position after losing from 10-20% due to your ego. Every buy order should also accompany a stop loss order. A stop loss order is a preset sell order that is automatically activated when your position falls to your maximum loss price. This ensures that you will never lose your entire postion value from a losing move. A good currency trading software for this is here.
6. Judge Your Success By The Month – Lets face it everyone has bad days and weeks but you can’t judge a person or a business on a limited period of time. You could have 4 horrible days in a row and the next day make back all your losses and make a nice profit. Success is the winner of the marathon not the sprint.
7. Use Trading Software – The key to being successful in currency trading is to develop a consistent trading system. You will develop techniques and learn tips that you will consistently use on a regular basis. Getting comfortable with your trading software is manadatory to becoming a successful trader. Here is trading software that is one of the best in the industry.
8. Leverage is Good and Bad – When you first start trading I advise against maximizing your leverage since it is to easy to lose big money quick. After you have traded and feel more comfortable it is much safer to use higher leverage especially when using stop loss orders.
9. Trading hours – Professional corporate traders trade off hours since there is less volume and they can wipe out the smaller traders. Smaller traders should trade during business hours since there are many more trades and the big guys have much less advantage.
10. Become a Specialist – There are 34 currency pairings and all require current information and updates. It is impossible to follow them all so learn to follow and specialize in 2-3 currency pairings. Specialists make the big money.
Trading currency is not only fun but profitable. The more you trade and learn the easier it becomes to reach millionaire status.