Day trading has been one of the most well-known and widely misunderstood forms, not only in the foreign exchange [foreign exchange] market, but also in the stock and futures markets. Technology and experience are especially important for Forex traders because market promoters ["smart money"] are notorious for manipulating short-term price actions to carefully slaughter fresh prey.
Unfortunately, beginners of online forex trading tend to think that day trading is somewhat easier, safer, and more suitable for those with very little experience - and only requires a small account balance. It is not.
Even in such a heavily manipulated market environment, profitable day trading in the foreign exchange market is indeed possible, but it is not a suitable method for each trader for a number of reasons, both psychological and practical. If you choose to try, make sure you choose it for the right reasons.
I presented five survival keys to illustrate what really needs to be a full-time currency day trader.
1. Monitor price behaviors in real time every day.
I know this is not what beginners want to hear, but it is a fact. If you want to be able to learn textbook charts and apply them immediately, start with at least the hourly chart or the daily chart. Responding to price behaviors for short-term charts used for day trading [usually 15 minutes, 5 minutes or less] requires skills and experience elements in addition to understanding the basic price behavior principles.
If you decide to learn the trading [or even reselling] timeframe, keep an eye on the speed of price changes and the price range around the rounded numbers [x.xx00 price level, or xxx.00]. ]
2. Learn, understand and internalize the true meaning of price behavior.
The foreign exchange market is driven by orders, whether they come from corporate entities or speculators. Imagine that the current price is a city bus that will travel north [long] or south [short] [into the transaction] after you board it. On this "road", there is a city bus every 10 points. traffic light. This is a major intersection every 100 points [large circles].
For the purpose of this weird [but hopefully descriptive] metaphor, let us assume that you are unable to access the timetable, maybe you are visiting this strange foreign city [foreign exchange novice], so you can't even ask the driver which Way to go [you can't ask market promoters what they are going to do] - All you know is that you want to travel one way but there is almost 50/50 [I emphasize almost 50/50 because the bus is unlikely to take you Go to the opposite direction you want.
The point is, after you jump on a bus [into the transaction], after which direction, you should remember that every 10 points there is a traffic light [the other party's order] that may or may not turn red [and therefore stop Bus.] If it turns red, the bus may have reached the end of its path [reverse], or it can continue in the direction it entered [continue] when the light turns green.
As mentioned earlier, the traffic lights we should be most concerned about are the main intersections [large "double zero" circular digital price levels.] Buses are unlikely to end their route on some random small residential streets instead of One of them - not very likely, but not impossible.
Remember, the driver won't tell us where he/she is going, so we trade the probability, not the guarantee. Our job as a day trader is to learn, practice and internalize ways to profit from higher probability.
3. Never think of these suggestions as other [long-term] forms of trading applications for day trading or scalping.
Many of the recommendations of books and internet forums are very good for swing traders and position traders, mainly hourly and higher time frames. As far as I can see, it is rare and is very suitable for short-term day traders and scalpers.
An example of a thought is a common strategy for entering a transaction after a "confirm" breakout. In hourly and higher timeframe strategies, it may be very effective to wait for the price to significantly break through the support or resistance area. In short-term intraday trading, these short-term support and resistance areas are more closely linked, and the possibility is not conducive to such late trades. Instead, try to "guess" the overall direction based on a higher timeframe chart [or just zoom out to get a larger image] and then enter based on a short-term retracement.
Similarly, many trading books emphasize the importance of trading psychology. Although it is a major factor in dealing with the inevitable losses in day trading, weeks and months, it is not really a factor for long-term traders - less but not completely irrelevant. In day trading, psychology is more important than any other transaction, because it affects the decision-making process for each transaction you make every day.
There are other examples I'm sure but remember that not everything you read applies to your situation - although some of them will be different.
The key is that as a day trader in the foreign exchange market, you are trying to tame one of the world's most vicious and carnivorous tigers. While some advice for domesticated cat owners may be applied to your situation in some way, it is usually best not to assume that all [or even most] of their recommendations apply in the same way.
4. Never expect to win every trade, never assume that you need it.
90% of the world's trading advice will tell you that you can't win every trade. The other 10% lie to you [or rather, try to lie to you.]
No professional trader has a 100% equity rate, and there is no even a first-level bank trader and market maker. Of course, their percentage is higher than average retail traders and even hedge fund traders, but there are occasional losses. it does not matter.
Forex trading and all financial instrument transactions [stocks, futures, options, foreign exchange, etc.] are a business. Like all other businesses, from film studios to convenience stores, losses are a fact of life. Finally, what matters is whether a month, a quarter or a year is profitable - but not every transaction is needed.
Most beginners of online forex trading tend to jump from one method or "system" to another to find the key to that, single, non-destructive transaction. Marketers use this ignorance through marketing lie, using "non-destructive" robots and books that promise impossible. For Forex, there is no secret "lossless" formula, not a "dating" "rejection" formula; some people try to get quite close, but it will never be a perfect 100% record... and It does not need to.
5. If you are a beginner, please have realistic expectations.
I realized that not everyone who reads this article is a complete beginner. Some people may even be profitable traders who want to expand your strategy. Unfortunately, the vast majority of traders looking for new information are system funnels that lack experience and knowledge. Therefore, #5 is almost entirely aimed at struggling beginners.
Don't expect to be able to consciously predict market movements with little or no knowledge of market and price behavior. You may be lucky in a demo account, but when you trade with real money, it won't be the same experience, especially when it comes to day trading - the most psychologically charged trading method for novices.
in conclusion.
In fact, most beginners and other inexperienced traders [and not yet profitable on a monthly or quarterly basis] are better suited to long-term trading strategies. In addition, long-term strategies allow traders more free time and require less screen time.
Day trading is a professional profession that requires years of work and experience to master. If it is the road of your choice, be prepared for the bumpy road ahead. Please be assured that this is not impossible - but it is not easy... and it is not the only way to make a profitable trade.
Orignal From: 5 key factors for survival in Forex Day trading
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