naijababe:

Naijababe’s simple guide to trading success

I am not the highest contributor here but I am a growing trader and from time to time like to share my experience.

In the wonderful world of trading, much can be gained and a whole lot more can be lost; if you manage to acquire the skills and the right mental attitude and discipline, then you truly have a skill for life. These are not in any particular order; I wrote them as they came into my head. Enjoy folks and happy hunting

• Trading is not a get rich quick scheme, like every other endeavour in life; it requires a good depth of knowledge and strict discipline. Put in the work, remain focused and disciplined and you can reap truly amazing financial rewards
• Set clear goals and stick to it
The number of times I have seen people trying to trade every opportunity and then lose their entire account is almost countless. I have been there and if there’s one thing I know now, it’s that I can’t trade every opportunity. For example, I only trade 5 instruments and a I have a goal of 300 pips per week, if I meet my goal on Monday, I won’t trade for the remaining days in the week.

• Take time to learn – The one thing you don’t want to do in this business is dive in head first, it will only lead to one end and that end is not nice.

• Learn to love your losses – Losing a trade is a normal part of trading, when you lose a trade, analyse it again and see where you went wrong (if you did at all). I have made trades that ended in a loss and upon reassessing the trade again knew I’d do the same thing again. The market is what it is; sometimes it just doesn’t do what it should.

• Make a trading plan and stick to it – This is probably one of the most difficult aspects of trading, entering trades that you have not analysed can also lead to one thing and you all know what that is.

• Learn to diversify – I have heard people say on this thread that a beginner should only trade one instrument; I beg to differ. When you are learning, try trading two pairs at least and no more than four. Make sure your choices are not all major pairs. If I was asked to recommend pairs for a beginner I would recommend the following with reasons shown
EU or GU – Poster child for the avid learner, rarely whipsaw or behave out of sync
EU/GBP – Good for beginners mainly due to average daily range (in other words, you stand to lose less if a trade goes against you)
My main reason for suggesting more than one pair is to avoid putting on blinkers when you start to trade other pairs. No more than four because you get easily distracted and not learn the peculiar nuances of each pair.
• Correlation – When trading, it’s important to know the correlation between your instruments and other instruments even if you don’t trade them, e.g the dollar correlates negatively with crudes, commodities correlates positively with CAD and AU pairs, EU correlates with CHF etc.
• Operating costs – As I said before, trading is a business; you should put your operating costs in perspective and whilst I realise that you can’t control costs like electricity and internet subscription, the one thing you can control is spread. Why trade 20pips spread instruments when those with 1 -4 pips spread abound?!
• Own your decisions – Success will be far from you in trading if you don’t learn to own your trading decisions. This is why it’s important to not just depend on anyone to generate signals for you but for you learn and understand the reasons for your trading decisions.
• Be decisive and remain disciplined – What type of trader do you want to be, a contrarian, a trend, breakout or momentum trader? Do you want to day trade or swing trade? Decide which it is and be disciplined enough to follow your system even when you are not doing well. Let me make something clear here; you should only continue to follow your system if it has brought you success in the past ( no system guarantees a 100% success)
• Don’t get high on your success or trade when you are not emotionally calm e.g. one of the worst mistakes you can make is to enter a trade in anger or vengeance having just lost – I can guarantee you that the market will punish you for it.
• Use available resources well – Websites like fxstreet and babypips have gems of information and learning tools that will aid your success.
• Keep it simple – I have seen charts overloaded with indicators that I can’t even see what price is doing. Why do u need 5 EMAS, MACD, stochastic, RSI when every single of this indicator tells you the same thing.
• Use a birds eye view – This means you should take a general look at you entire screenshot first and not just your last two or three bars/candles.
• Finally, manage your account like your life depends on it. Apply the 2 and 5 % rule – Only risk 2% of your account at any given time ( personally, I use 6%) and when you’ve lost 5% of your equity take time away from trading for a week at least to get a fresh perspective ( personally, I use 10%)

I hope this helps and where I have expressed contrary opinion to what you do, bear in mind that it’s not a criticism- These are just my own rules and they work perfectly for me.

Am taking a buy on GU and EU with very good stop loss.
Hope to close the trades tomm with lovely TP.

resourceng:

hello, just joined the forum and also a forex trader, though i just started about 6 month ago. see that the thread is really hot because of the amount of posting am seeing here. anyway am in sell eu at 1.37371, anyone in this trade.

resourceng:

just exited with 20 pips profit been that was what i went for initially before the news.

Am long on GPB/USD, TP 1.5866 SL 1.5739 so help me God

namdo:

The Swap thing (for those who take advantage):

This is a very interesting article if you want to set up your position to receive interest on all positions placed. Imagine not worrying about holding positions for a certain length of time because you're getting interest on your money every day.

Wouldn't that take the edge off of stressing over your open positions that are losing?

When opening forex transactions, the actual value date is two days forward. A deal which is done on Monday is for Wednesday’s value. A deal done on Friday is for Tuesday’s value (Saturday and Sunday are not counted), and so on. Please note : On Wednesday the amount of swap is multiplied three times (tripled) to compensate weekend holidays which swap is not charged.

How to Calculate Swap:
Traders will earn positive swap if the currency bought has greater swap rate than borrowed one.

Example 1:
USD/JPY Pair. USD Swap Rate = 5.25% , JPY Swap Rate = 0.5%
Buy USD/JPY means a trader is buying USD by borrowing JPY. Since bought currency’s swap rate (USD) is greater than borrowed currency’s swap rate (JPY), the trader will earn interest income : 5.25% - 0.5% = 4.75% When a trader Sell USD/JPY (means borrowing USD to buy JPY), the trader will be charged by interest fee : -5.25% + 0.5% = -4.75%

Example 2:
EUR/USD Pair. EUR Swap Rate = 3.75%, USD Swap Rate = 5.25%
Buy EUR/USD means a trader is buying EUR by borrowing USD. Since bought currency’s swap rate (EUR) is smaller than borrowed currency’s swap rate (USD), the trader will be charged by interest fee : 3.75% - 5.25% = -1.5% When a trader Sell EUR/USD (means borrowing EUR to buy USD), the trader will earn interest income : -3.75% + 5.25% = 1.5%

Forex Broker usually provides a list of daily swap rates for every currency pairs available. Traders could find interest fee / earning based on Buy or Sell positions they will trade. (swap is usually in $ or pips value). If the swap value is quantified in pips, traders need to convert pip to dollar by calculating pip value of corresponding currency pair.


To check the swap rate for a specific currency using the MetaTrader Platform :

1. Click on MarketWatch
2. Right click on any currency
3. Choose symbols
4. Double left click "Forex"
5. Left click a currency of choice
6. Click on properties

Now you can view what the swap is for going long or short


Happy pipping.

lecanno:

The Swap Thing (namdo)

Imagine not worrying about holding your position for a long while, days, weeks, or months (lol), because you are getting interest on your position everyday.

That would take stress off you especially if your entry is well thought out even if the position appears losing.
When opening a forex position actual value date is two days forward. A deal on Monday is for Wednesday value. Friday's deal is for Tuesday value, etc. saturday and sunday not counted but on Wednesday value of swap is trippled (x3) to take care of the week end holiday when swap is not charged.

How you calculate Swap:
A trader will earn positive swap when the swap rate of the currency bought is higher than that which was sold/borrowed.

Example:
USD/JPY: USD swap rate = 5.25% JPY = 0.5% swap rate.
If you buy USD/JPY you earn 5.25 - 0.5% = +4.75% on that position per day.
If you sell USD/JPY you incure -4.75% against your position per day.

EUR/USD: EUR swap rate = 3.75%
If you buy EUR/USD you incure 3.75-5.25 = -1.5% charge per day against your position
If you sell EUR/USD you earn 5.25-3.75 = +1.5% on your position per day.

Brokers usually provide swap rates for every available traded currency daily.

To check swap rates before taking a position on metatrader platform:

-Click on Market watch
-Right click on any pair
-Chose 'Symbols'
-Double left click 'forex'
-Left click a pair of choice
-click on properties

You can then view what the swap is for your desired instrument before going long or short (to your advantage).

Happy pipping.