Forex for Beginners – 2 Of The Greatest Forex Trading Tips That I Know
I have traded currencies for years. I have been through the ups and downs. I have also taught many traders how to trade, and I know what it is to see people struggle with trading concepts. So in this article, I want to give you two very simple trading tips that can turn your trading around.
Tip #1 – Use multiple timeframes
Perhaps there is a timeframe that you like to trade. It might be the 15-minute, the 1-hour, or the 4-hour. It doesn’t matter, but you should have a single timeframe that you use to time your entries and exits.
But many traders forget that they can (and should) use other timeframes to identify major market moves.
For example, every day before you trade, you need to find the daily trend. In essence, you need to see which way the markets are flowing and go with the flow.
To do this, you should switch to the daily charts. Now if you are trading on the daily charts, go up to the weekly or monthly charts to find the trend.
The purpose of moving up a timeframe or two is to get an overall picture of the market. Then move back down to your chosen timeframe and set your entry and exit orders.
Tip #2 – trade one currency
Especially as a beginner, you need to choose one currency and stick with it. A lot of people choose the EUR/USD or the GBP/USD. You could even choose the EUR/JPY or the GBP/JPY. Just choose a currency that you will trade and stick with it.
Believe it or not, each currency has its personality. Why? Because each currency represents a particular country or region. So it makes sense that these economies will be affected by different stimuli, and you need to understand what affects your currency.
Sure, your currency might not be moving while that one over there is. You will be tempted to switch currencies (at least temporarily) to catch the move.
I have 3 words for you – suck it up.
Don’t switch. You might miss a move or two, but if you will stick to your currency and learn it inside and out, then making money in the forex will become second nature.