One of the most well-known and significant trades nowadays is forex trading. Due to the fact that this trade operates on a decentralized network and is available around the clock, its market is fairly liquid. So it’s a perfect trade for all sorts of traders whether you’re a beginner, seasoned, big or small trader.
But even with its many pros, you’re still faced with its cons and one of which is its volatility. Although trading in general nature is volatile, forex is just a bit wilder. This is because it’s less regulated, various things affect its value and you’re faced with multiple risks.
But all of that will be worthwhile if you know how to swim with the current of forex reading. As a beginner, there are certain things you need to start early to become a great forex trader. So if you’re curious, down below is everything a successful forex trader should have!
Before you start trading, you need to have certain skills to become a great trader. Without these skills, you might be doing more harm than good to your trading career. So to trade efficiently you must be skilled in mathematics, analysis, planning, anticipating, strategizing and have the willingness to learn.
All these skills mentioned above make up a great forex trader. So before trading, try honing these skills to guarantee efficient and profitable trades.
It’s a necessity for all traders to work with trading platforms, so why not make sure you’re working with a good one? Another ‘must-have’ to become a successful forex trader is working with a great trading platform.
A trading platform is where you can make trades, use tools, practice, learn and so much more. So whichever platform you choose greatly affects your trading experience and output. So to help you out, down below is a list of great trading platforms to consider:
- eToro – Offers copy-trading and funding tools, has a generous inactive policy, offers a stop-loss tool, has various training materials available, offers an economic calendar and is easy to create an account with.
- IG – Offers outstanding platform and tools, has over 19,000 tradable instruments, is beginner-friendly, has an excellent interface and offers competitive pricing.
- Incentive brokers – Has zero balance minimum, offer a wide range of trading tools, offer various tradable securities, allow access to various trades, have low trading costs, and are beginner-friendly.
- Forex.com – Has little to no withdrawal costs, offers low initial costs, offers a great platform interface, allows easy customization of trading tools and charts, and is beginner-friendly.
- Xtb – Offers a great selection of trading tools, has great customer service, and is user and beginner friendly.
Another essential thing you should have as a starting trader is a trading strategy that suits you. A trading strategy acts as your guide when trading so it’s vital to have one, especially one that you’re good in. So before trading, lessen the risks by having a trading strategy in place. Here’s a list of strategies to consider:
Using technical indicators to determine the direction of market momentum. It is predicated on the notion that markets are somewhat predictable, thus a trader will be able to predict what could occur in the future by examining previous trends and price movements.
This is a long-term strategy where traders hold their position over a long period of time whether it’s a couple of days, weeks or even months. With this strategy, traders must maintain modest market movements that oppose their position while also taking a macro view of the market.
This is a short-term strategy that requires a trader to open various trades a day and closes them once a market movement occurs. This kind of trading only takes around 3 to 5 hours max.
This is a kind of intraday trading in which traders purchase and sell currencies intending to make tiny profits on each trade. The majority of scalping methods in forex are based on a continuous analysis of price movement and an understanding of the spread.
Support and resistance serve as the foundation for range trading. The highest and lowest point the price hits before turning in the other direction is known as the support and resistance levels on a price action graph.
To amp up your odds of profiting big in trade, you need to know what sells the best. And for forex trading, it’s certain pairs of foreign currency. So, trade like a pro by knowing the best currency pairs to trade down below:
- EUR and USD – Euro and Dollars are the highest-valued currency as of today. This is also one of the most actively traded pairs among the rest.
- USD and JPY – Dollars and the Japanese Yen are the 2nd most actively traded pairs.
- GBP and USD – The Great Britain Pounds and Dollars – This pair has made it to the top 3! This is also a great strong pair to consider.
- AUD and USD – If you can’t already tell, Dollars act as a base currency for other currencies around the world. This is also a great pair to consider since Australian Dollars are one of the high-valued currencies today.
- USD and CAD – Last but not least are Dollars and Canadian Dollars. This pair has made it to the top 5 best currencies to trade. This is a pair to also consider.
Yes, forex trading can be tedious and is a risky way to make a profit but with the right strategies, methods and brokers, your chances of becoming a successful trader increase! So, now you know the forex trade must-haves, use this newfound information to good use and start your trading career the right way!