CFD market is one of the largest markets, and millions of people are trading in this platform regularly. Day trading is a common CFD trading strategy, and many professionals do this with their advanced knowledge and skills. This strategy can be an effective way to make more money within a short time, but it is still very dangerous. There are a few strategies for the day-traders, which can be followed or maintained to avoid losses.
Forex day-trading strategies
You can start your day-trading by following these strategies –
1. Take a break and avoid frequent trades
Newbie day-traders in Singapore enter into the trades frequently because they can’t resist their temptations to make more money. They assume that frequent trades can beget more money, which is entirely a wrong conception. Experts always suggest entering into trades less frequently to avoid risks and market crashes. Besides, entering the market will give you more time to learn and acquire knowledge about the Forex industry. As you gain experience, you can start trading commodities with high end broker Saxo and boost your potential earning. But always trade without having any emotional attachments to the market.
It can be hard to control emotions because it can lead an investor to enter the trade. There are certain tips to follow to avoid day-trades, such as –
- Avoid FX scalping
- Enter into the trades with a greater timeframe
- Wait for the potential trades, and avoid entering the market without being confident
2. Start the business by analyzing the trendline
There are multiple indicators like parabolic SAR, momentum, divergence, moving averages, triangular moving average to determine the condition (whether it is uptrend or downtrend). These technical indicators can be helpful for day traders. These traders must be patient to progress their trading careers.
If you notice that there are no trends and the market is following a ranging pattern or consolidated movement, it will be better to wait. Trades with a trend indeed can help an investor to earn more profits, but if the trend is absent, you should wait.
3. Position management during day trading
Novice investors should determine the take profit and stop loss limit for every trade because these limits will minimize the losses during a market crash. Beginners make another mistake while determining these limits. They set these limits based on their feelings and emotions, which is never a good decision to make.
The Forex market doesn’t follow your emotions and feelings because lots of external factors like GDPs, interest rates, inflation, unemployment rates, economic recession, and performance control this movement.
Some beginners place the stop-loss limit too close to the buying position, while others place the limit too far. Instead of randomly setting the limits, they are encouraged to analyze the market first and then set the limit.
Position/lot/volume size is another critical factor that can contribute to the amount of losses or profits per pip movement. Smaller position size will result in smaller losses/profits depended on the graph’s movement, while higher position size will result in higher losses/profits depended on the graph’s movement. For example, if you choose the position size 0.1, then the amount of profits/losses will be $10. Now, if you increase the size and choose it 1, then the amount of profits/losses will be $100 based on the movement.
9/30 Business strategies for the newbies
Adapting this business strategy can help you overcome many challenges during the trades. The strategy will restrict the frequency of trades by helping to choose the best trades on that day. In addition, this 9/30 can capitalize on the retracements. If these rules are followed and properly maintained, it will be easier for anybody to find potential trends.
It can be an excellent trading strategy for the newbies, but always remember that no strategies can work 100% efficiently in this type of style. So, try modifying the existing one to make it more powerful.