Strategies that believe you can double your account balance each month are tempting. You want to learn them and wonder at the secrets these strategies behold. The truth is some forex trading concepts like doubling your account each month do not work out as you hope. Before you consider following any of these purported strategies remember that it is you who will be making any plan you have work. If you are not invested enough to learn the basics about the foreign exchange market you won’t succeed. If you spend a week learning and figure you know everything you need to know, you will have problems. There are a select few out there in the world with an eidetic memory. Most of us have to use hard work and efficiency as our weapons.
Forex Trading to Increase your Profits
You can certainly set a goal to double your account balance each month. There is nothing wrong with having a goal. Just remember there are a lot of mitigating factors to be concerned with.
1. The forex market is uncontrollable. Governments tried and failed. You will certainly fail if you think you can control the market by forex trading.
2. News can change how a pair reacts.
3. An international business transaction can affect a currency pair.
4. You can miss important signals for trading in the right direction.
The list of what could go wrong with your goal can go on. Each day, week, month, and year is going to be different for all currency pairs. If you are intent on forex trading with only one or two currency pairs it will be harder to double your account each month. Note the use of “hard”, not impossible. It is very possible.
The reality is just saying you need to be dedicated, efficient, and have the knowledge required. Once you have those three traits you can work to double your account when the market is favourable.
Forex Trading in a Favourable Market
First recognise a favourable market:
· It is a market where investor sentiment is high and fear is low.
· Economic stability is found throughout the globe, even though some areas may be stumbling.
· You have reports that are good with some economic reports not so good, leading to forex trading with a strong and weak pairing. It is better than two weak currencies you are trying to eke a profit from.
Once the market is favourable, you can start to plot out each trade you make. If you trade every day than each trade you make needs to have a plan for entry, exit, and risk management. Your goal is to make a certain pip profit on the currency pair you have chosen to trade. You set risk management orders like trailing stop loss to prevent any significant loss if the market reacts counter to your forex trading position.
You choose profit points that are not at the high point but midline, as you know you will gain a few pips profit and do not have to worry about an emergency evacuation from the pair.