There is no doubt that the Forex or Foreign Exchange market is one of the largest financial markets with the potential to make millions. Well, the secret to being a millionaire with forex trading lies in mastering the complexities of the forex market.
It is only the complexity in understanding the trend that can bring high returns to the trader and also lead to the risk of losing a large amount at once. The main reason behind such potential in the forex market is its volatility that dwarfs stock and bond markets at ease.
One can rarely witness a trading day with no major movements, thus providing incredible chances for traders every single day, sometimes multiple times a day using a scalp trading strategy.
Nevertheless, making money from trading currency is not as easy as it seems as the risks involved in every position due to volatility are insane.
A pro trader needs to deceive the risks and come out with higher returns using an innovative strategy in every trade placed in the market. But, as you came here looking for a way to make money every single day trading forex, here is the 5-step guide that you should follow.
- Paper trade
Forecasting the upcoming trend in the price margin of any chosen currency pair is not easy for a beginner, mainly due to the extreme volatility. The first step towards progressing in your experience level to forecast better is paper trading contract for difference sa. You need to keep an eye on the trend every day based on multiple sources that influence it and prepare a physical chart if possible.
Paper trade improves the predicting ability of the forex trader to a whole new level although there can be some exceptions in the movements due to sudden changes in the international market. Nevertheless, you can save your capital from the risk of loss to a great extent after gaining good experience in paper trading.
The best way to paper trade is to use the demo account provided by the forex trading platforms.
- Scalp trading
Also known as short-term trading, scalp trading is one of the best ways to ensure decent returns every single day from trading forex. In this, you need to set a reasonable limit to your losses using the tools available in the chosen forex platform. Eventually, you can make small profits from trading throughout the day with lower volumes.
Well, you need to focus on choosing the right currency pair and use reliable triggers to place your trade. With scalping, you are safer than other forms of trading as you may either end up getting higher returns or with limited losses.
As you will have multiple opportunities throughout the day, high chances are all the trade returns will sum up for profits at the end of the day.
- Use stop-loss at reasonable price levels
Although stop-loss is used mostly in scalp trading to limit the loss in every trade, this feature is favorable for all kinds of trading strategies. By setting your stop-loss at reasonable levels, you can reduce the risk of losses and increase the proximity to higher returns without much stress in both uptrend and downtrend.
- Preserve your capital
While placing trades at different positions one after another, you should keep your capital in mind and see whether you are losing most of it. If your strategy crossfires multiple times, it is better to stop and analyze the whole trend at different periods to understand it well. One of the biggest mistakes that every trader does is losing cool when a serial loss occurs in multiple trades, and thus ends up losing most of their capital.
- Look out for higher movement and use the leverage
Last, but not least, you need to be wise and play smart in some cases that you may or may not predict from before. Although it is suggested for beginners to use a stop loss at reasonable levels and play safe with minimum deposits, once you get experience, you need to up your game by using leverage.
Well, one should have enough assurance from multiple sources that impact the price range of a particular currency pair before using leverage as the risks also increase with the chances of profits.
You can make money every day by trading forex if you follow this 5 step guide consistently, but some moves can be learned only with experience, so consistently is undoubtedly the key to success in forex trading.