Making decent income based on currency trading is really hard. Only 5% of the traders are able to lead their lives based on the currency trading profession. Many novice traders often ask the expert Aussie traders why the number of a successful trader in the Forex market is so low. The professional traders give them a simple answer – lack of trading knowledge. Before you become a doctor or engineer, how much time have you spend on education? At least 4 years of full-time study is required to get a graduate degree from the university. But when it comes to currency trading, how much time do you really spend to master the art of trading. In fact, the majority of the traders wants to become rich within a very short period of time. They don’t want to spend any time in learning the basic details of this market. In today’s article, we will discuss some of the key factors which will dramatically improve your winning edge.
Price action trading strategy
The retail traders always try to make their system overly complicated. They think that dealing with lots of variables will increase their profit factor in the global trading industry. However, the professional Aussie traders always believe in simplicity. They never take any risk which they can’t afford to take. Instead of trading the market with a complex trading system, they simply use price action trading system to place a trade in favor of the long-term trend. Price action trading is nothing but the use of Japanese candlestick pattern at the key levels. As a price action trader, you have to do the market analysis in the higher time frame since it will dramatically improve your winning edge. Though the system is extremely profitable yet you should never trade the market for high-risk exposure. Always try to protect your investment from the wild nature of this market.
Professional brokerage firm
Your brokers play a great role in your trading success. If you trade with the low-class brokerage firm you are not going to get access to the professional trading platform. The expert Aussie traders always suggest the new trader’s trade with a professional brokerage firm who will offer high-quality trading environment. If you gain access to the professional trading platform you can easily do advance technical analysis. Most importantly you will face minimum slippage even during the extreme level of market volatility. The high-class broker in the online Forex trading industry will also offer you hassle free transaction which is very crucial for the full-time trader. For instance, if you trade with an unregulated broker, you might even lose your investment. You need to make sure that your broker has proper licensing documents to offer financial service to their retail clients. So chose your broker very wisely.
The simple 2% rule of money management
Majority of the traders are losing money due to their greed. They simply place a trade based on their emotions and loses trades. At times they become frustrated by seeing a series of losing trades which is very common in the Forex market. You need to use the simple 2% rule of money management to become a successful trader in this industry. If you lose trade, never get anxious to recover your loss. Wait on the sideline for the next trading signal. You need to understand the fact that trading is not a get rich quick scheme. You need to consider trading as your business. When you take this profession as your business. You will see a dramatic improvement in your trading career. Never try to trade with big lot size since it doesn’t work in the longer time frame. You need to consider the probability factors of this market. If you can trade this market by following proper money management, you will never blow your trading account. Always focus on your investment as a full-time trader.