4 Proven Strategies to Boost Your Forex Trading Profits

Forex Trading is a complicated activity that offers great opportunities for profit but, at the same time, hides many pitfalls. Less experienced traders, often beginners, seek shortcuts that can lead them to success in a short time. In short, some tricks. It must be said, however, that tricks in the literal sense of the term do not exist, as there are no easy paths to wealth. If, however, we understand the concept of a trick in a broad sense, that is, as "smart" techniques and approaches, then Forex Trading abounds with them. In this article, we will describe four of them, which are immediately executable even by the less experienced.

Instinct

According to some, following one's instinct when doing Forex Trading is a huge mistake. This is not true, at least not completely. Obviously, instinct should not be the main driver of one's trading activity, far from it. The risk, in this case, is that of considering Forex as a game of chance, and therefore facing capital loss and failure. However, this does not mean that instinct should not have a role, albeit a small one. After all, this is what distinguishes man from machine: the ability to interpret, even instinctively, even at an unconscious level. In short, when you feel particular sensations, when fear mounts, it is good to stop for a moment and think about what you are doing. Using your emotions as a sort of warning signal, or an alarm, is useful yes, but only in one case: that is, when you have reached a state of balance, in which you manage to keep emotions at bay and, far from being a victim of them, you approach them in an active way. Instinct alone leads nowhere. Instinct accompanied by a sense of balance, intellectual solidity, analytical skills, on the other hand, allows you to go a long way. As can be seen, the success of this trick, if it can be called that, does not depend on experience but on one's personality, on moral characteristics. It is the person who takes center stage in this case, not just the trader.

The Trend

An old adage, very common among investors, states: "The trend is your friend". It may seem an exaggerated maxim, even harmful as it flattens every strategic approach and reduces the margin of discretion available to the trader. Yet it rarely betrays. Following the trend, in fact, truly proves to be, in the short as well as in the long term, a strategy that if not winning, at least prudent, moderately conservative. In short, if the trading style is based on prudence, on the policy of small steps (as is the case in most cases), then the trend is truly the trader's friend. The reason is simple: you encounter much less difficulty in reading continuation signals rather than reversal signals. Also because, if it is a reversal, it is also necessary to find important and difficult parameters, which concern timing. If you follow the trend, the only element to find, basically, is "how long" the trend itself will last, and to do this, supports and resistances come to the aid, all in all simple to master. If you are looking for a reversal, not only is it necessary to find evidence to support this thesis, but it is mandatory to know when this reversal will occur. And it is not at all simple, especially if the reversal is dictated by emotional factors, rather than by a linear market trend. Another phenomenon must also be considered. The market is emotional. Certainly not always, and not decisively, yet it is true: emotion guides investors. The model of rationality, which sees the investor as an actor who always acts rationally, has had its day. Now, it so happens that the most prevalent emotion is fear. It follows that the majority of traders follow the trend, rather than operating in open rupture, in the sign of discontinuity. In plain words, they follow the trend. All this clearly outlines a virtuous circle, in which reversal becomes rarer than continuation and is triggered only by events of considerable magnitude. All this, obviously, in the medium and long term. It is evident that in the short term there is a certain dose of volatility.

Patience

Here, this is a trick, indeed a piece of advice, that few follow, especially if you are at the beginning and you are pervaded, perhaps following a winning trade, by euphoria. Very often, to trade well it is better... Not to trade at all. This may seem a contradiction, but it is only from the point of view of syntax, not of logic. Just think: those who try to seize any opportunity that arises in the market have, in absolute terms, a greater probability of making mistakes. Those who go to the mill too often often get floured. This, to be clear, is a saying from popular culture, not from the world of trading, but it is nevertheless useful for understanding the context. The advice, therefore, is to be patient. This translates into a simple attitude (at least in words): preferring quality to quantity. It is not necessary to always answer the call of the market, in fact it is harmful, precisely for the reasons described above. Every now and then, one can and even must stop. Certainly, one cannot do it at random. Fatigue, or worse fear, cannot represent the compass. The element to be taken into consideration is purely technical. Upstream it is necessary to draw up a strategy and a plan for the operation, which includes the description of the situations in which to intervene, and the methods of the intervention itself. It is not easy for sure, but it is a must.

Discipline

This is probably the most difficult advice to follow. Discipline: a word that many fear, as it refers to situations that are not at all comfortable. Yet discipline is the fundamental element of every successful career. All successful traders, who have become rich thanks to Forex Trading, are disciplined. There is not even one who has reached his goals by favoring creativity and improvisation. It may be an unpleasant truth, which clashes strongly with the romantic idea of Forex Trading that many have at heart, but that's the way it is. Now, it is necessary to explain towards whom this discipline is directed and the ways in which it should present itself. Well, discipline must be maintained towards... Oneself. Exactly: everyone must remain faithful to themselves, must obey themselves, must do what they say... Themselves. It may seem an abstruse reasoning, but it acquires great solidity if one considers the type of "self" to which one must pay obedience. Not the self of the operation, excited, fearful, vulnerable; but rather the self of the strategy, cold, effective, inexorable. In plain words, it is necessary - indeed, absolutely necessary - to respect one's own strategy and adhere scrupulously to it. Rash decisions, intuitions and improvisations are absolutely to be avoided, except in specific situations such as those, in fact, described in the first paragraph (the one on instinctiveness).