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Op-Ed

The winning habits of successful forex traders

Becoming a successful forex trader may seem like an unrealistic dream at first, but following these steps will bring you closer to reality

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The winning habits of successful forex traders | News Central TV
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Who is a forex trader?

A forex trader is an individual who exchanges one currency for another in the global financial market. The financial market is an over-the-counter (OTC) market, where financial instruments are traded. It is considered the largest and most liquid market in the world, with a daily turnover of over 5.6 trillion dollars. 

Anyone who wishes to become a successful trader is responsible for honing their skills through education and consistent practice. At FXTM, we believe educated traders are successful traders, which is why we run very detailed seminars and workshops, both at an introductory and advanced level at our offices and training centres here in Nigeria.

The winning habits of successful forex traders

Anyone can train to become a disciplined trader, through self-analysis to see what drives their operations and also learning from their mistakes & forex psychology.

It is a fact that successful traders think and act differently. They usually have specific habits and follow a series of steps or patterns which guide them daily as they trade in the markets.

When you start trading forex, you know that it can be very lucrative and rewarding, but this does not mean that you do not have risks, or that 100% of the time you will be successful. It is important that you master the basic concepts and understand the foundations necessary to excel to become successful.

Get going!

To achieve what you want, you must focus on trading and make it part of your daily actions. You must also understand that behaviour is an integral part of the trading process and thus, your attitude and mindset should reflect the following attributes.  

Let’s have a look.

1. Manage your money

There is not a single successful trader who does not know how to manage their money. The art of understanding money management – knowing how much you can invest and afford to risk, in addition to being able to establish the appropriate losses and thus, take profits at the right time, are skills that are indispensable and that you must acquire.

The winning habits of successful forex traders

You must preserve your capital always and at all costs, in order to possibly generate wealth in the long-term.

2. Manage your emotions

Remember that in forex trading, there is no place for emotions of any kind. If both the winners and the losers act in the same way, the operations will be executed in a more professional manner and without drastic changes.

You can achieve this with calmness and dedication; for example, if you are upset because one of your trades is experiencing losses, try to take a break from the trade. You can reintegrate once you have calmed down.

Avoid making any emotional decisions, as this can lead you to commit commercial mistakes and disasters that will result in losses.

3. Take advantage of demo accounts. Use them until you are ready

Demo accounts are usually a great way to test the waters in a place where it is not risky since you do not lose real money.

This applies above all if you are a newbie and so you can try different trading platforms. But once you feel very prepared to start a live account, you may try it, and take a chance.

4. Run your winners in order to have as many benefits as possible

Now, in the financial markets, there are many beginners who think that the best traders are the ones who are always right.  This is a myth because, in the world of trading, not everything is theory.

Then, once you have found an asset that meets your skill-set, hold on to it and learn to polish that skill. You should always learn to obtain benefits that are significant enough, as this is the only way in which you can cover your losses.

5. Cut losses early

By taking into account how difficult it is to be profitable in the competitive forex world, you must keep an eye on them and are willing to cut losses ahead of time, even if they are your profitable trades.

This means that when the market moves against you, you should not trust that it will return soon. Of course, unless there is a signal that is clear, precise and expresses what will happen in the market, in that case, leave soon and go to the next, always with the hope that it might be profitable.

5. Learn from your mistakes and see them as knowledge

You learn while doing it. That is why you should not allow a bad experience to truncate the path to success.

It’s a learning curve that would allow better decision-making in the future.

6. Find the perfect strategy and repeat

It is well-known that trading can be like a big battle to take money out of the market. And to be able to achieve this in the most appropriate way, you would need a repeatable and efficient strategy that works for you in the long run.

The market is always changing, which means that you will sometimes need to make adjustments to your strategy.  That way, you might have more chances to win if you can find a way to make your strategy work. Don’t waste more time.

7. Separate your life habits from the trading habits

 It is important that you can make time and maintain a balanced lifestyle to your life outside of trading. Having a healthy and calm lifestyle requires that you take regular breaks from trading during the day.

This will help you to make better trading decisions and as a result, you will have more chances of being successful.

8. Search and use methods that have been tested and you can prove it

Do not believe everything you read and see on the internet, remember that it is a minefield of lies and people seeking profits on the back of frauds.

That is why you should look for a real test of the methods that are being promoted to you and verify that they really work well.

This insurance process can include going with current trends, also reducing your losses, in case you are seeing a benefit, or letting go.

9. Never forget the risk / reward

Do not forget that there is always a risk before a reward. The ratio of risk to reward is not going to be the same all the time, due to the fast-moving nature of the financial market. There are times when it may seem that you are failing in the trade with the risk you see, only so that everything can become a reward in this way.

Then you can proceed to make your withdrawals and they can be about half of your returns or even less. You must pay attention and definitely not expect for every trades to produce profits every time.

10. Keep a trade journal

By having a trading diary, you can keep a record of your winning positions as well as the ones you lost. It is also important to also point out the characteristics that led you to that position, and be able to analyse these results.

The winning habits of successful forex traders

It is necessary to be very orderly in the life of a trader, since keeping a record of trades gives the trader a really objective platform and thus, be able to better understand both their options and their decisions. All of these are important in order to improve the process of trading.

11. Take responsibility for your movements

This habit is linked to controlling your emotions, with the difference that this time you must not just control your emotions, but that you have to accept them.

You must take responsibility for each of the movements or decisions you make, and you should not blame anyone for your losses.

Equally, this means no one but you gets credit for your profits. Do not invest in more than what you can afford to lose.

12. It’s not just habits that make the trader, it’s the personality too

Habits are important because they form a routine for the trader and make them a person who follows certain steps that will lead him to their next gains. However, personality also plays one of the most important roles in being a successful trader and it is the perfect complement for these habits to work in their entirety.

A trader must have a defined personality in order to predict a pattern of behavior that will not only help them to understand the market better, but also the way in which the same trader manages that market.

For example, there are traders who are calm and determined; in case they are not 100% sure of a trade, they may decide not to go ahead with it and thus, maintain their current balance.

In this way, they remain a cautious and patient trader.

At the same time, there are traders who take risks and this can lead them to have huge profits, or big losses. Regardless of personality type, the important thing is that the trader knows themselves, knows what kind of habits are indicators for them and what their movements are in the market.

Summary

Finding at least one advantage in forex trading will help keep you in a superior position; having good trading habits can certainly be one of these advantages.

These habits that were explained previously serve for all types of traders. Organize yourself and create a routine with habits that could lead you to success.

The views expressed in this piece are the author’s own and do not necessarily reflect News Central TV’s editorial stance.

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Op-Ed

Gold: Positioned to thrive in low-interest-rate environment

Rising concerns surrounding the health of the global economy is another one of the engines that will help drive Gold prices

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Gold: Positioned to thrive in low-interest-rate environment

The investment case for Gold is set to remain robust as speculation mounts that major central banks will ease monetary policy in an effort to counter a global economic downturn.

The yellow metal shone with extreme intensity during the second quarter of 2019, rallying roughly 9 per cent to levels not seen above $1,435 in over six years, thanks to an environment that included ongoing global growth concerns, geo-politics, trade tensions and Dollar weakness.

Weak macro data, which reflects downward revisions in global growth over the past 12 months, is prompting a handful of central banks including the European Central Bank (ECB), Federal Reserve (Fed) and Reserve Bank of Australia (RBA) to signal a willingness to ease monetary policy and increase economic stimulus to support growth.

In a low-interest-rate environment filled with chronic uncertainty, Gold can climb another 5 per cent over the course of Q3 – claiming the title as one of the high flyers among safe-haven assets, in competition with the Yen. 

Will Gold’s fortunes hang on the Fed’s actions?

Will Gold’s fortunes hang on the Fed’s actions?

What investors need to watch as the second half of the trading year gets underway are the actions of the Federal Reserve. Will the US central bank confirm market expectations and cut interest rates as early as July? If it fails to do so, Gold risks rapidly surrendering its second-quarter surge.

Essentially, if the Fed sits on its hands beyond July, profits will be taken from the table on the $120+ rally that transpired in Gold throughout June. 

Unfavourable global conditions to keep Gold in fashion

Rising concerns surrounding the health of the global economy is another one of the engines that will help drive Gold prices.

Although a sense of optimism has returned after the Trump-Xi Jinping meeting at G20 ended in a trade truce on tariffs, it does not change the reality that global growth is decelerating.

The World Bank recently downgraded it’s 2019 world growth forecast to 2.6 per cent from 2.9 per cent and if the recent disappointing PMI releases across the manufacturing sectors in Europe, China and the United States are anything to go by, global growth is moving towards the lower bound of 2 per cent as the decade draws to a close.

Warning signals over potential cracks in the largest economy in the world, indications of tepid growth in the EU, disappointing data from China’s manufacturing sector and lacklustre growth in the United Kingdom amid Brexit-induced uncertainties are likely to sweeten appetite for safe-haven assets. 

It’s all about central bank stimulus and lower yields 

In the longer term, Gold should also find support from lower treasury yields, especially if the 10-year treasury dips below 2 per cent again as persistent growth fears and trade developments result in lower interest rates across the globe.

While the outlook for the precious metal points to the upside, potential roadblocks on the horizon include easing trade tensions and signs of global growth stabilizing. Both outcomes would pose a challenge to buyers.

What do higher Gold prices mean for African markets?

What do higher Gold prices mean for African markets?

Gold-producing nations on the continent, like South Africa and Ghana will certainly benefit from higher prices.

Economic conditions in Africa’s most industrialised economy remain unfavourable thanks to a tornado of domestic and external risks. Economic growth contracted by 3.2 per cent during the first quarter of 2019 thanks to a sharp decline in manufacturing, agriculture and mining.

Given how Gold remains one of South Africa’s most valuable exports, rising Gold prices have the potential to stimulate growth – especially when factoring in how exports account for roughly 30 per cent of GDP.

Economic growth in Ghana remains robust with GDP expanding 6.7 per cent during the first quarter of 2019. With Ghana claiming the title of Africa’s top Gold producer, higher prices will be supportive of the mining sector which expanded 20.9 per cent in Q1.

When adding to the fact that roughly 5.7 per cent of Ghana’s GDP and 40 per cent of gross foreign earnings are acquired from the mining sector, Gold’s bullish outlook brightens Ghana’s growth prospects.

Gold bulls to dream big and reach for the stars 

Taking a look at the technical picture, Gold remains firmly bullish on the monthly charts as there have been consistent higher highs and higher lows.

Prices have scope to push higher on the monthly charts should $1360 prove to be reliable support.

For as long as bulls are able to defend $1360, there should be enough confidence to challenge $1430 and $1500 – a level not seen since April 2013. Alternatively, a decline back below $1360 will most likely swing open the doors towards $1324 and $1300, respectively.

This bullish setup becomes invalidated if prices find comfort below $1300.

The views expressed in this piece are the author’s own and do not necessarily reflect News Central TV’s editorial stance.

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Op-Ed

Remembering Abdirahman Osman: Reformer and Friend

People close to Mogadishu’s slain mayor said he never complained about the huge burden of getting the city back on its feet.

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Abdirahman Omar Osman, spokesperson of the President of Somalia addresses the Somali media during a visit by the African Union's Peace and Security Council (PSC), on it's first visit to the Somali capital Mogadishu, with the President of Somalia in 2013.

Abdirahman left his family in London to answer the call to rebuild Somalia several years ago. He did so at great personal risk and in spite of the fact that he was leaving a comfortable life and a good job to take on a position in Mogadishu with no salary and immense danger.

He told me that he did so because he believed that there was hope for Somalia, that there was work to be done and that the biggest chunk of that work had to be done by Somalis themselves.

Everyone knew Abdirahman by his nickname, Engineer Yarisow. In Somalia, virtually everyone has a nickname; it’s an affectionate way that Somalis relate to each other. Never mind the nicknames can be as rude as they are hilarious: they are often based on one’s physical shortcomings. If you have a big nose, for instance, your nickname in Somalia will likely be ‘fat nose’ or something along those lines.

Abdirahman was a great man of summary stature, his nickname, therefore, was naturally ‘short man’ – Yarisow. He was an important man whose door was always open to those who came looking for him, particularly those in the media industry. He was kind, committed and deeply respectful to everyone. He was our friend.

We last met while he was still the Minister for Information, Culture and Tourism. We had coffee in his office and we talked about the editorial I penned on his behalf for the EU-AMISOM Special Edition Magazine. We joked about having arosto at a Somali restaurant in Harrow, near where his family lived and where I had some relatives.

He went on to become the Mayor of Mogadishu and the Governor of the Banadiir region. It was in this capacity that he breathed his last, having been targeted by religious extremists. Eng Yarisow always knew that the rebuilding of Somalia would require sacrifice and would come at great cost to many. He knew that the toll for a new Somalia would be high. He has paid it at the highest price: with his life.

Rest well aboowe. Your work and your name is indelibly carved in the hearts of your people, your family, friends, colleagues and all who knew you. May Allah grant you the highest place in Janna. Amin.

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Op-Ed

Will oil prices help or harm Nigeria’s economy in Q3?

Global Oil prices looked tired, exhausted and ready for an early summer break during the second quarter of 2019

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Will oil prices help or harm Nigeria’s economy in Q3?

Global Oil prices looked tired, exhausted and ready for an early summer break during the second quarter of 2019 as global growth fears overshadowed supply disruptions and ongoing OPEC supply cuts. At the time of writing, Oil prices remain shaky and vulnerable despite OPEC+ latest decision to extend production cuts until March 2020.

The crucial question is whether Oil prices will ever recover and trade back towards the $70+ levels. That depends less on geopolitical tensions in the Middle East and more on whether the US and China can reach a trade deal, settling disputes over tariffs and opening the door to continued global growth.

In this case, it’s likely that Oil prices will be injected with a renewed sense of confidence on the back of boosted global growth expectations and demand for Oil. But what if the current circumstances persist and the US-China trade disputes continue throughout the second half of 2019? 

Taking each scenario one-by-one, starting with the upside for Oil prices, Nigeria’s economy could benefit considerably if a US-China trade deal is reached and global growth expectations become brighter. The manufacturing sectors in the US and China are the Oil-gobbling engines which drive demand for international Oil suppliers.

China is the world’s top crude Oil consumer, importing more than 50 per cent of its consumption, part of which comes from Nigeria. In the fourth quarter of 2018, Nigeria exported ₦23.5 billion worth of crude Oil to China and remains a major trading partner to the Asian giant. It’s likely that if China’s economy roars back to life, Nigeria’s growth would see more long-term support, benefiting foreign exchange reserves and the naira.

Although unlikely, if a trade deal were to be announced early in the quarter, it’s possible the nation’s 2019 budget would also see ample support from increased Oil revenues from China. This argument doesn’t apply to the US which has considerably reduced its crude Oil imports from Nigeria as it heads towards energy independence, relying instead on domestic production to meet its own needs.  

If you take the negative outlook on Oil, it’s more likely the rise in Oil prices is a temporary result of supply shortage fears and the prevalent trend in Q3 will be downward pressure from concerns over a global recession. In this unfavorable scenario, the world’s two largest economies do not reach a trade deal in the third quarter and aggregate demand for Oil continues falling as it tracks economic weaknesses in China and the US.

As demand for Oil is whittled away, Nigeria’s foreign exchange reserves may be negatively impacted, along with the Naira, the 2019 budget, and most importantly GDP growth.

In terms of the national budget sheet, expenses like the petrol subsidy may take the limelight as they drag on revenues, overshadowing growth and threatening fiscal stability. 

There’s another factor we haven’t talked about so far but it’s significant in terms of Oil market economics. Oil sales are denominated in US Dollars. Recently, the currency has weakened against its rivals, meaning that Oil is more affordable and possibly giving traders an incentive to snap up contracts at current levels before they rise further.

If the Dollar bears have their way and the currency keeps declining, Oil price benchmarks could see further support in the third quarter. The impact of a weaker USD might not be as strong as a US-China trade deal, but it could feed positively into Nigeria’s Oil revenues and go some way to counter possible losses from ongoing global recession fears. 

To sum up, Nigeria’s foreign exchange reserves, currency, growth, and budget will face headwinds should trade disputes persist.

However, provided the USD keeps weakening, there’s scope for support from higher Oil prices based on bargain hunting. There’s always the possibility that the US and China could decide on a trade deal, if this happens sooner than later, Nigeria’s economy would benefit accordingly. 

The views expressed in this piece are the author’s own and do not necessarily reflect News Central TV’s editorial stance.

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