RE: forex market

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forex market

in market •  7 years ago  (edited)

It definitely can be confusing at first when you aren't quite sure what to pay attention to. The act of placing a trade can be broken down into 4 parts:
Direction -use higher timeframes such as the daily, weekly, and monthly to determine likely direction
Limit - the price target to place your take profit order. It should always be farther from your entry than your stop loss.
Entry - how, when, and where to enter your trade. The most important part in my opinion because it affects both limit and risk. Ideally only use one or two entry strategies to stay consistent.
Risk management - risk less than you stand to profit, your stop loss should ideally be slightly beyond a recent high/low point (but not too close, highs and lows are often tested).

The reason entry is so important is that if it's a precise entry, your stop loss distance will be shorter, which means your take profit distance is shorter, which means the market has to move less to pay you. The market is more likely to move a shorter distance than a longer distance.

I would suggest spending hours upon hours learning about price action and looking at charts. Learn how to interpret candlesticks, support, resistance, pivot points, trendlines. One place I suggest visiting that I learned a lot from is tradeciety.com.
Good luck to you going forward, forex trading can be an excellent way to grow your wealth and generate income.

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