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8 tips for more profitable trading in 2020

But, this money machine is not that easy for all. Most people have very little knowledge of trading before they jump in expecting a quick profit… How much money can I generate in profitable trading? Well, this common question that  has no specific answer at all. It all depends on your skills and understanding of…

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Forex trading is one of the most profitable businesses in the world that can make a fortune for the savvy investor.

But, this money machine is not that easy for all. Most people have very little knowledge of trading before they jump in expecting a quick profit…

How much money can I generate in profitable trading? Well, this common question that  has no specific answer at all. It all depends on your skills and understanding of the art of trading. Research says 9 out of 10 people find it difficult to make profitable trading. So, what makes that one person a profitable trader than others?

For profitable trading, you must know the core principles of trading that are basics that every trader should follow. Expert opinion and advice is invaluable in gaining knowledge of the trade. Industry leaders like Rob Booker come with a series of podcasts to train newbies. Rob Booker reviews are the best to turn your trading into a profitable one. You can also find him on youtube channels with videos on  exciting Trading strategies and tactics. https://www.youtube.com/user/robbooker

Other than a basic understanding of trading, you can follow some simple tips for profitable trading in 2020.

Set a Profitable Strategy

You will come across a ton of different strategies to make profits in the market. You have to find a strategy that suits your goals  and objectives the most. You can set your strategies based on fundamentals, trade lines or moving averages. You should also account for your risk tolerance level in picking a strategy.

Other than that, set long term strategies to earn profits. Most beginners follow random strategies in a small time frame. That often turns loss and blows through your capital. In forex trading, it is always better to stick to a plan for a long time frame. Patience plays a big role in your strategy.

To learn more about a profitable trading strategy, you can read successful trader’s testimonial, blogs or take expert advice. Besides, all beginners must go through demo trading before they step into the real world  trades. You must first successfully execute your strategy on a demo account. Remember, you can always modify your strategy based on market trends later.

Control Capitals

In most cases, people start trading with 100 dollars or more. Whatever capital you are starting with, you must know about capital management. First and foremost, you will never invest the entire capital in one market. Experts say the maximum limit must not cross 20% of your total capital. Invest money in different markets, to minimize risk.

In terms of capital amount, there is an advantage of working with a bigger capital. If someone has only 100 dollars capital and loses 50 dollars in a bad trade, then he loses 50% in that trade. Whereas if the capital was 500 dollars, and he still loses 50 dollars on a bad trade, then there is only a 10% capital loss. So, try to manage capital in the best possible way.

Observe the Trade Market

The world’s biggest trade market is always changing. No single country can control the Forex market. But, there are factors that have direct correlations to the market. These can be sports events, politics, pandemics, natural calamities or any big trade war between superpowers.

Being an investor, you must go through newspapers and economic reports to better understand what affects the market trends. Also, it is important to track your own trades. If you research your past trades, then you will start to find the weak points in trading and what mistake to avoid. These are opportunities for improvement.

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Checking price charts

In forex trades, you must keep track of numerical data. A price chart allows you to find the best entry and exit points. You can calculate the PIP and make quick decisions in trading. There are plenty of free charting softwares to help build your business. Some of the market best are NinjaTrader, TradingView, Finviz, MetaTrader 4 and many more.

Trading charts can be three different types (line, bar and candle)with two different axes (price-y axis, time-x axis). The graph can have three different patterns denoting the market trend. The upper trend in the graph means appreciation of currency while the downtrend denotes depreciation of values. If there is a sideways trend, then currencies are at stable conditions.

If You Find It Wrong, Get Out

You can never trade expecting profits all the time. In fact, you must have to accept some losses in trading. So, only risk what you can afford to lose. There is no need to invest funds that can directly affect your life expenses. Don’t even take loans to become a trader.

All traders have to face some bad trades and capital loss. So, how can you minimize the risk? Experts say when you are facing bad trades, stop trading and get out to save your capital.

It is also important to figure out why your strategy failed. Too much trading in a short interval and going beyond expectation often can deplete your capital. In case you are sick or inactive, take a break and then come back stronger. Lack of concentration on trading can also hurt you badly.

Pick The Right Broker

If you are not comfortable with your broker, then change brokers. Brokers’ support is always important to grow your business. Find a broker with a good reputation and quality services. The broker must allow different trading accounts, spreads, optional leverage, fund security, trading instruments, order execution quality and slippage, and most importantly good customer support.

Keep Experimenting

All Forex traders have three different risk profiles- moderate, aggressive and conservative. Whatever risk tolerance profile you have, you must keep experimenting with your strategy. The foreign exchange market is always evolving every day. So, if you stick to the same plan, then things may not turn profitable for you.

You must keep experimenting a portion of your investment to redesign your strategy to be more effective. Many marketers believe experimenting is the key. There is no single strategy that fits everyone’s goals. You have to explore it and execute it for the best result.

Rock Solid Nerves

To become a successful gainer in trading, you must grow a rock-solid meind frame and nerves of steel. There will be tough times for sure. All successful traders had losses in their trading career. So, you have to accept it and keep continuing your trades. If you can stick to the market even after a heavy loss, then trading is definitely made for you..

Forex trading is profitable when you are strategic in the market. You have to plan every step and keep trying consistently. Experience and strategy will help you reach your goal. There are no shortcuts. You have to believe in yourself and keep trying.

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Don’t Count On JPY Correction; Staying Long GBP/JPY

The path of the potential pace of the JPY decline may still be underestimated by markets, which continue trading the JPY long.

While the 10% USDJPY advance from September lows looks impressive from a momentum point of view, it may no thave been driven by Japan’s institutional investors reducing their hedging ratios or Japan’s household sector reestablishing carry trades.

Instead, investors seemed to have been caught on the wrong foot, concerned about a sudden decline of risk appetite or the incoming US administration being focused on trade issues and not on spending. Spending requires funding and indeed the President-elect Trump’s team appears to be focused on funding. Here are a few examples: Reducing corporate taxation may pave the way for US corporates repatriating some of their USD2.6trn accumulated foreign profits. Cutting bank regulation could increase the risk-absorbing capacity within bank balance sheets. Hence, funding conditions – including for the sovereign – might generally ease. De-regulating the oil sector would help the trade balance, slowing the anticipated increase in the US current account deficit. The US current account deficit presently runs at 2.6% of GDP, which is below worrisome levels. Should the incoming government push for early trade restrictions, reaction (including Asian sovereigns reducing their holdings) could increase US funding costs, which runs against the interest of the Trump team.

Instead of counting on risk aversion to stop the JPY depreciation, we expect nominal yield differentials and the Fed moderately hiking rates to unleash capital outflows from Japan.The yield differential argumenthas become more compelling with the BoJ turning into yield curve managers. Via this policy move, rising inflation rates push JPY real rates and yields lower, which will weaken the JPY. Exhibit 12 shows how much Japan’s labor market conditions have tightened. A minor surge in corporate profitability may now be sufficient, pushing Japan wages up and implicity real yields lower.

JPY dynamics are diametrical to last year . Last year, the JGB’s “exhausted”yield curve left the BoJ without a tool to push real yields low enough to adequately address the weakened nominal GDP outlook. JPY remained artificially high at a time when the US opted for sharply lower real yields. USDJPY had to decline, triggering JPY bullish secondround effects via JPY-based financial institutions increasing their FX hedge ratios and Japan’s retail sector cutting its carry trade exposures. Now the opposite seems to be happening. The managed JGB curve suggests rising inflation expectations are driving Japan’s real yield lower. The Fed reluctantly hiking rates may keep risk appetite supported but increase USD hedging costs.Financial institutions reducinghedge ratios and Japan’s household sector piling back into the carry trade could provide secondround JPY weakening effects

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Daily Financial News

Mexico raises interest rates, cites Trump as risk

The head of Mexico’s central bank says U.S. Republican candidate Donald Trump represents a “hurricane” sized threat to Mexico.

Banco de Mexico Gov. Agustin Carstens told the Radio Formula network Friday that a Trump presidency “would be a hurricane and a particularly intense one if he fulfills what he has been saying in his campaign.”

Trump has proposed building a wall along the border and re-negotiating the North American Free Trade Agreement.

Mexico’s central bank raised its prime lending rate by half a percent to 4.75 percent Thursday, citing “nervousness surrounding the possible consequences of the U.S. elections, whose implications for Mexico could be particularly significant.”

Mexico’s peso had lost about 6 percent in value against the dollar since mid-August. It recovered slightly after the rate hike

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Africa’s first Fairtrade certified gold co-operative offers hope to gold miners living in poverty

Syanyonja Artisan Miners’ Alliance (SAMA) has become the first artisanal small scale mining co-operative in Africa to become Fairtrade certified, bringing much needed hope to impoverished communities who risk their lives to mine the rich gold seam that runs around Lake Victoria.

SAMA is one of nine previously informal groups from Uganda, Kenya and Tanzania which has benefitted from a pilot project launched by Fairtrade in 2013. This innovative program aims to extend the benefits of Fairtrade gold to artisanal miners across East Africa.

In that short time, SAMA has undergone training in business and entrepreneurship, as well as safe use of mercury, internal control systems, labour rights and better working conditions, health and safety and more. Previously, daily contact with toxic chemicals used to process gold meant members risked disease, premature births and even death.  Fairtrade gold was first launched in 2011, and SAMA now joins Fairtrade certified gold mines MACDESA, AURELSA and SOTRAMI in Peru.

The co-operative produces just 5 kg gold per year, but nevertheless has the potential to significantly benefit many people in the local community through better conditions through certification. It is expected that Fairtrade and organizations like Cred Jewellery will support the miners, ensuring their gold can be refined and made available to jewellers in the UK and other markets.

Gonzaga Mungai, Gold Manager at Fairtrade Africa said: “This is a truly momentous and historical achievement and the realisation of a dream that is many years in the making. Gold production is an important source of income for people in rural economies. Congratulations to SAMA, it sets a precedent which shows that if groups like this can achieve certification, then it can work for others right across the African continent.”

The Fairtrade Gold Standard encourages better practice and changes to come in line with international regulation around the production and trade of so-called ‘conflict minerals’. Under the Standard, miners are required to:

  • Uphold a human rights policy preventing war crimes, bribery, money laundering and child labour
  • Clearly represent where the minerals were mined
  • Minimise the risks of conflict minerals through robust risk assessments and collaboration across supply chains
  • Report to buyers and trading partners regarding the risks of conflict minerals

Now in its second phase, the programme will focus on supporting other mining groups in the region to access affordable loans and explore a phased approach to accessing the Fairtrade market, allowing more mining co-operatives across Africa to participate in the programme.

Gonzaga added: “Sourcing African metals from smallscale miners in the Great Lakes Region is the responsible thing to do. For a long time companies have avoided buying gold from this region, with devastating consequences for impoverished communities who were already struggling. It has driven trade deeper underground, as unscrupulous buyers pay lower prices and launder illegal gold into legitimate supply chains. That’s why we have chosen to work with these groups to help them earn more from their gold within a robust compliance system that offers social, environmental, and economic protections.”

The Fairtrade gold programme offers a small but scalable solution to sustainable sourcing of gold from the region in line with Section 1502 of the Dodd-Frank Act in the US, OECD Due Diligence Guidance and recent EU Supply-Chain Due Diligence proposals which could come into effect in 2016. This means that up to 880,000 EU firms that use tin, tungsten, tantalum and gold in manufacturing consumer products could be obliged to provide information on steps they have taken to identify and address risks in their supply chains for so-called ‘conflict minerals’.

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