The rookie traders always have high expectations from the market. They start their trading career without having adequate knowledge and eventually blow up the trading account. They don’t realize the fact, to become good at currency trading profession, they must learn to take the trades with proper discipline. Most importantly, they have to follow a valid trading strategy. You might be thinking that creating a professional trading strategy is a tough task. But if you go through this article, you will realize it is one of the easiest tasks in the investment business.
Now we are going to discuss some key steps which will allow you to take the trades in a structured way. Make sure you follow the tips mentioned in this article as it will allow you to make wise decisions. So, let’s start learning about the key steps of creating a professional trading strategy.
You might be wondering that everyone is determined to become a successful trader. This statement is very true but when it comes to devotion, very few traders are willing to walk the extra mile. Most rookie traders start their careers based on emotions. They don’t even spend enough time to learn about the support and resistance level. Eventually, they blow up the trading account within a short time. So, make sure you have strong determination to create a professional trading strategy, or else do not take any trades.
Access To A Demo Account
Once you are determined that you are going to learn the art of trading, you need to open a demo trading account. To know more about the demo trading account, you may view website of Saxo. Once you learn about the premium features offered by Saxo, you will no longer trade with the low-end brokers. So, start using the demo trading tools and try to learn the basics of trading. Check the support and resistance levels of different trading instruments. See how the market works and prepare yourself to learn advanced stuff.
Learn To Use The Trend Line
Everyone knows trend trading is the most efficient way of making money. To make a regular profit in the retail trading industry, you must learn to ride the major trend. Learn to draw the major trend line by using the highs and lows. Try to rely on the higher time frame as it will give you much more accurate data. Once you become good at drawing the line, you should trade the market with the trend. Check the trading performance and if you feel confident, you need to move to the next phase.
Study The Candlestick
Studying the candlestick pattern is one of the best ways to prepare yourself for the currency trading business. Many professional ETF traders use the price action confirmation signals to take their trades in the market. So, if you wish to become a professional trader, try to rely on a price action trading strategy and take your trades with much confidence. At the initial stage, you may think learning about the different formations of the Japanese candlestick pattern is a tough task. But if you try to understand the reason for which candlestick patterns work, you won’t have to face any trouble.
Learn Risk Management Techniques
After learning about the price action trading strategy, you will become a very confident trader. But this doesn’t mean you will be taking aggressive steps in the trading profession. No matter how good the trade setup is, you should be risking only 2% of the account balance. And if you lose few trades in a row take a small break. In every trade, you should assess the risk to reward ratio factor also. If it is less than 1:2, you should not take the trades. Always remember, a higher risk to reward ratio makes the overall trading process easier and lets you make a consistent profit even at the most complex state of the market.