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A Step-by-step guide for forex day trader
Source: | Author:finance-102 | Date2023-01-20 | 160 Views | Share:
Forex Day Trading is a popular way for traders to make quick profits by buying and selling currency pairs within the same trading day. This step-by-step guide provides a simple and effective strategy for both novice and experienced Forex traders to plan and execute their Day Trading strategy.

Forex Day Trading is a popular way for traders to make quick profits by buying and selling currency pairs within the same trading day. This step-by-step guide provides a simple and effective strategy for both novice and experienced Forex traders to plan and execute their Day Trading strategy.

 

Step 1: Know Your Currency Pairs

As a trader, it is essential to understand which currency pairs you want to trade. Different currency pairs have different rise and fall values, so it is crucial to know which currency pair will most likely earn you a profit. One effective way to choose the right currency pair is by using an economic calendar to predict data results released by major countries. An economic calendar is a schedule of releases and events that significantly affect the market as a whole. By paying attention to market updates and performances announced by major countries, traders can gain insight into the direction of the market and make informed decisions.

 

Step 2: Determine Trade Expiry

Since Day Trading expires within the day, as a trader, you will need to carefully select which Forex trade you want to place by considering its expiry. You have the option to place trades that last for seconds, minutes, or a day. By determining how long you want your trades to be live and active, you can make quick profits in short-expiry trades, such as 30-second or 45-second trades, which are often more probable after major countries release their economic data.

 

Step 3: Set Your STOP LOSS (SL) and TAKE PROFIT (TP)

When you trade Forex via a web or mobile trading platform, it is important to set a stop loss and a take profit to limit damages and ensure profits, respectively. The values of these factors depend on your actual trading budget. You can base your stop loss on the financial value of each trade you place and decide for yourself by considering the rate fluctuations. Similarly, you can set a take profit of 30 or 40 pips, for example, and opt to close a trade when you reach your take profit limit to ensure earnings. However, if your trading budget drops, it is best to stop trading and mark it as a losing trade.

 

In summary, this step-by-step guide provides a simple and effective strategy for Forex Day Trading by selecting the right currency pairs, determining trade expiry, and setting stop loss and take profit limits. Remember, proficiency in trading and a well-thought-out plan leads to profits.


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