The advice is to go slow, very slowly, at least initially. This means choosing a tool (which can be CFD or direct trading) and a Forex pair. Once that choice is made it is necessary to specialize on it. Which means identifying the best market movers, behavior patterns and indicators to predict prices? Lets find out with Libertex.
Okay, managing risk in a rational, technical, even slavish way is boring; it takes away the charm of trading. However, it can save lives. The reason for this is almost obvious: managing risk means saving, and saving means being more capital than an uncontrolled activity.
How to manage the risk? The discipline that deals with it is called risk management. Without going into details, we can anticipate that a fundamental step consists in identifying the sum that you are willing to allocate in your trading account and, proportionately, the sum that you are willing to allocate for each trade. A good rule, which must however be examined by the trading plan, is never to spend more than 3% of its capital per single trade. According to this approach, more than thirty consecutive losing trades would be needed before getting broke.
Set the Stop Loss
Stop Loss is a fundamental tool to limit losses. Indeed, it is a significant part of risk management. Specifically, the Stop Loss is the price level beyond which the order is closed immediately. If automatic trading is used , exit from the market takes place, in fact, automatically and is therefore placed outside the discretionary space of the trader. If manual trading is used, as is obvious and obvious, the output must be manual, spontaneous.
The focal point of using the Stop Loss is its identification. What is the most suitable price level? Well, trade by trade must be found. One of the many ways to identify it is to use pivot points, i.e. resistances and supports.