The Smartest Options in Forex Trading that You Need

The Smartest Options in Forex Trading that You Need

Losses, however, must be controlled and must never escape the trader’s analysis, any trading operation, however rational, may, even in very low percentages, lead to a negative result, well; this negative result must be controlled and reduced to minimum. Minimizing your losses means increasing your profits, so it means optimizing your online trading activity.

To be able to rationalize your losses, you need to establish a sustainable loss percentage for each trading operation, this percentage must never exceed 5% of the investment capital: if you have a capital of € 1,000, your maximum loss, for each transaction of trading, must be 50 € and the gain obtainable from a single transaction must be at least double the potential loss, that is, you must accept a 5% risk only if in that transaction you can earn at least 10% of what you have invested. The best of AvaTrade options are here for that.

Follow Only A Few Assets

There are many trading opportunities, but to be able to specialize and understand the performance of a certain asset, or rather of a certain currency pair, you must follow it constantly. To follow we mean that you must daily follow the market, trace the trends, trace the supports and resistances and highlight the inversion phases. Obviously, to do such work you can’t follow 100 currency pairs, but you have to follow about 5, at least at the beginning.

Check the Economic Calendar

The economic calendar is a fundamental tool for understanding when there are events that can influence the market. There are some traders who only trade macro economic data and earn very well by taking a low risk. Obviously, not all macroeconomic data influence the market in the same way and not all macro data can be exploited to make money from the short-term AvaTrade reaction. It must be remembered that investment in macro data is something very simple; in fact it is sufficient to wait for the data to exit and follow the market reaction:

The Smartest Options in Forex Trading that You Need

If the market reacts positively, then a long position opens up, that is, buying.

If the market reacts negatively, a short position opens up, that is, a sales position.

Investments based on macro-economic data are short-term investments; in fact, the positive or negative fluctuations have a duration ranging from a few hours to around 10-12 hours.