How to work on Forex without losing your money.
In order to work in Forex, you need to have certain knowledge and experience, so the trader’s primary task is not to earn huge money, but at least to simply save the deposit from being drained during the first months of trading.
The task, although complex, is completely doable; to solve it, you should follow some recommendations about the practical side of the matter, which will be discussed in this article.
I will try to give novice traders some tips regarding practical Forex trading, which will help them not repeat the mistakes I made in my time.
In order to preserve your capital, and then increase it, you need to follow these tips:
1. Optimal volume of transactions - every trader knows that thanks to the use of leverage, you can increase your own capital several hundred times, but is this necessary for real work? Not always, especially if you are just starting to work in Forex.
To start trading, it is recommended to use a leverage of no more than 1:50; however, it should be taken into account that if the amount of your deposit is less than $200, then you should open a cent account. Since the minimum volume of transactions on standard accounts is usually 0.1 lot.
Next, we open transactions, observing the ratio of the cost of one point and the amount of funds in your account. The best option is when a movement of one point on Forex is equal to 0.1% of the deposit amount.
For example: You have 1000 dollars in your account, which means we are trading with a volume of 0.1 lot, while 1 point will be equal to only 1 dollar.
2. Always use a stop loss - it is set immediately when opening an order, and not later, only in this case you will insure yourself against losing your deposit.
The recommended size is in the range from 50 to 100 points, but we should not forget about the market situation; focus on the size of the correction . In addition, depending on how long you plan to keep the deal open. The shorter the timeframe, the smaller the stop loss.
3. Do not use advisors - at least at first, you will still not be able to configure them correctly and as a result you will be left without money.
There are very few trading robots that can consistently generate profits, and they also require competent optimization of parameters.
4. Do not open trades at random , always use the readings of Forex indicators or factors influencing the exchange rate (news trading).
5. Intraday trading - try to close all orders within one day, do not leave them for several days, this will allow you to avoid additional commissions.
6. Ease of trading - at first, don’t get carried away with overly complex trading strategies , you still won’t be able to grasp their essence, and mistakes will cost you money.
And of course, study, study and study again, only this approach will allow you to find the answer to the question - how to work on Forex without losses and drawdowns and not lose your own money. Don't forget that 95% of traders lose their first deposit within a few days.