Forex trading is all about being right with your forex trading signals and making money ? You don't get rewarded for the effort you put in to forex trading strategy the only thing that matters is profit.
Here we are going to focus on working smart not hard to make more money from trading.
Before we discuss our forex tips in greater detail, lets look at two key points in regard to currency trading.
1 The Big Trades Only Happen a Few Times a Year
If you look at any currency chart the really big strong trends only occur a few times a year and these are the trends that offer the best risk reward. The rest of the time the markets are either trending sideways with no clear trend, or showing high volatility which is hard to trade.
2. Trading The Odds
If you want to make money you need to trade the odds and get them on your side. The best way of doing this is to focus on set ups that give you a clear trading edge which is easy to see on any forex chart.
You need to look for valid support or resistance which has been tested numerous times over several months ? you know if these levels are broken the likelihood of a new trend developing are high.
The two tips to make more from your forex trading system are:
1. Cut back the amount of trading you do
And only focus on high odds trades ? look for valid breakouts of support and resistance and trade them.
Keep in mind, most big trends develop from new market highs NOT market lows so you need to focus on the breaks and go with them.
Use a breakout methodology and ONLY trade these high odds trades. You won't trade often but each trade you go into will have the potential for triple digit gains.
If you like the excitement and buzz of trading this method is not for you, but if you want to make money from your forex trading strategy it is!
This now leads onto the second point:
2. Risk More Per trade and DON'T Diversify
You will hear a lot about diversification and cutting risk but all it does is dilute profit potential.
You will also read a lot of investment wisdom that says risk only 2% per trade, well if you are a small forex trader with a $5,000 account, that's just that's $250.00!
Forex markets involves taking risks and with risk goes reward - the more you risk the more you make pure and simple. If you are trading a currency move that is a high odds one risk more ? 10 ? 20% is a good figure to aim at.
The above forex trading strategy focuses on making money nothing else and will cut the time you spend forex trading. Furthermore it's based on a breakout methodology which is simple to learn, easy to apply and is discussed in the next article in this series.
