Even though hundreds of successful forex traders trade in live forex signals, more than fifty percent of them don’t get any success in the first time. This is because Forex trading is not a cakewalk, and people who think so will inevitably fail in their first attempt. If you don’t want to commit the mistakes that others are doing, and if you want to be successful in daily forex signals, you’ll gain a few actionable insights in the forex trading and the things you mustn’t do from this article.
1- Keep your calm while trading
There are two strategies you must keep in mind before trading: – Win rate and risk/reward ratio. Your win rate depends on the number of trades you win as a percentage. If you win 70 trades out of 100, your win rate is 70%. A day trader must maintain a win rate of at least 50%. Your risk/reward ratio is relatively between how much you win and how much you lose. If your average winning rates are $70 and losing trades are $40, then your reward ratio is $70/$40 = 1.75
A day trader, you must keep your reward ratio more than 1 in live forex signals. Keep a balance between the win rate and reward/risk ratio. You have a good chance if your win rate is higher or the reward rate is lower or vice versa.
Additionally, never invest in a losing trade. It is a dangerous practice. The price can move against you in no time, leaving you in a soup. Instead, position yourself correctly and set a stop loss on the trade. If the price hits the stop loss, you know that you shouldn’t be trading further.
2- Don’t risk more than you can afford to lose
Risk management in live forex signals takes you a long way. You must calculate how must capital you’re willing to investin each trade. Experts state that you must not risk more than 2% of your account balance. You might be under the impression that risk-takers become great daily forex signal traders in the long run, but this notion isn’t correct. You need to follow the forex tips UAE while trading and keep a tab on the market. If you don’t do so, you’ll be at the losing end. Take only those risks which you can recover or can afford to lose.
3- Never anticipate the news
We all know how dubious the market is. Anticipating news can mislead you and negatively impact your live forex signal investment. Often the price moves swiftly in both the directions before settling for a sustained direction. This means you’ll lose the trade if you trust the news release and invest in the wrong direction. Instead of anticipating the news and believing the hype, create a trading strategy that gets the prices in your favor after the news. This way, you’ll make a profit from daily forex signals despite the volatility.