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Top Forex Trading Tips

The forex markets are estimated to be the biggest markets being traded globally. About 5 trillion USD is traded daily. The sheer liquidity in these markets makes forex trading particularly appealing.

To trade profitably, it is critical to control the natural risk involved in forex trading. And the most efficient way to do that is to learn with the intent to obtain a quality education in it. 

That means before starting to trade, someone who is a beginner should spend time reading up on how forex trading and the market works. 

How to use the available platforms. And observe how the markets trade over a while with a Demo account in hand. There are many websites, books, and other resources that give beginners all the knowledge they need about forex trading.

However, the best forex trading teacher is experience. It is very easy for traders to think the market will come back around in their favor when they make a blunder. Hope is never a healthy strategy, but unfortunately many will fall prey to this trap, and the likely (eventual) result is the demise of the trading account.  

There is a famous – but painfully true – statement from John Maynard Keynes about investing: 

“The market can stay irrational, longer than you can stay solvent.”

 In other words, there is no use in saying that the market is acting irrational and that it will come around to go in the direction favorable to the trader. This is because extreme moves define capital markets in the first place.

Getting Started

To get started, one needs to understand what is being traded. Beginners very often tend to jump in and start trading anything that looks profitable (see Panic Buying or FOMO). Of course what may seem profitable may reverse direction very quickly, especially in the forex markets (or any volatile market). Out of fear, a beginner trader might then try to trade in a different direction. And these random trades in both directions will often lead to more losses.

Learning how to trade online

Therefore, understanding the nature of how currency markets fluctuate and how the trader executes the trades will be a major determinant of whether the trader makes money or not. 

For example, a currency may be bouncing upward after a large fall. This may cause new traders to try to “catch the bottom.” Experienced traders will tend to dissuade the bottom catcher by a counter saying of “Never catch a falling knife.” 

Another component of managing risk is to keep emotions under control. When the trader feels fearful, greedy, or over-confident mistakes become inevitable. Price charts are meant to be read with a logical mindset that only sees the presence or lack of potential for success, and not be a matter of excitement.

Experienced traders warn their more inexperienced counterparts that, if pulling the trigger on a trade feels emotional in any way. Then that action should be re-evaluated to determine the reason for going into that trade and try to regain an objective mindset.

Related: Online Trading Benefits

Best Forex Trading Tips

1. Get familiarized with the forex markets

Education is the best way to manage the risk involved in forex trading. The importance of educating oneself on the forex markets cannot be over-emphasized. 

The beginner trader should take the time to study currency pairs and to identify what affects them before risking capital. Investment in learning can potentially save the beginner trader a lot of money and grief. 

2. Make a plan and stick to the plan

Creating a trading plan is an absolutely essential step in the path to successful trading. The trading plan should include your profit goals, risk tolerance level, methodology, and evaluation criteria. Once the trading plan is in place, the trader must ensure that each trade falls within the plan’s parameters. 

The trader should bear in mind that he is most likely to be rational before the trade is placed and most irrational after the trade is placed.

3. Forecasting the forex markets

Fundamental traders trade based on news and other financial and political data. Whereas technical traders prefer technical analysis tools such as moving averages and other indicators to forecast market movements. 

Related: Seasonal Trading 

Most traders use a combination of the two. Fundamental analyses tend to point to the likely trend. Whereas technical analyses tend to pinpoint the good entry and exit points within the trend.

4. Know the trading limits

This is a very simple but yet important risk management technique that determines success. Knowing how much to risk on each trade, setting the leverage ratio in accordance with the trader’s needs, and never risking more than one can afford to lose are vitally important steps in a trade setup. 

5. Setting limits and stop losses 

Beginner traders normally do not have the time to sit and watch the markets every minute of the trading day. They can better manage their risk and protect potential profits through stop and limit orders. 

Stop losses will close off the trade at a predetermined level. In that way, the trader is able to determine the maximum loss that is incurred in that trade. 

Although these pending orders may not necessarily limit the risk for losses. It can, however, help to determine the maximum loss that can be incurred. Thus helping to preserve capital for future trades. 

6. Keep Emotions in Check

Emotion should not be allowed to get in the way of successful trading. It is probably not advisable to take “revenge” trades after a losing trade, and trying to go all-in and try to make it back in one large trade. 

It is more advisable to stick to the trading plan and try to recover a little at a time. Rather than to suddenly find oneself with two crippling losses.

7. Slow and steady wins the race

A key to successful trading is consistency. All traders have lost money, but if a trader maintains a positive edge. He will have a better chance of coming out on top. Educating oneself, creating a trading plan and sticking to it may be the best way to ensure success in the long run.

8. Continuous improvement 

While consistency is important, it is now wrong to re-evaluate the trading plan if situations change.  As the experience of the trader grows, his needs may change, and therefore his trading plan should reflect his current goals. There is no point in sticking to a plan that is no longer relevant to the present situation.

In conclusion, a solid education in forex, proper planning, objective research, good trading habits, and emotion control will provide a good chance for the trader to be a success in forex trading. Additionally, you can learn from the pros directly by learning about social trading and joining trading communities like TradeGateHub. Finally, put everything into practice by opening a free demo account.

Jin Yau

Country Manager
jyau@tvmarkets.com

trading tips from tiktok, can you trust them?

Can You Trust Trading Tips from TikTok?

By this point in time, most people reading this article have heard about TikTok. For better or worse, the popular Chinese social networking app has amassed a huge following of younger generations.

These younger generations aren’t just 8 year-olds addicted to their parents’ iPads. They are also newly professional, recent college graduates earning a living and looking to invest

Retail brokers like Charles Schwab added an impressive number of young retailers in 2020. More than half of them were under the age of 41. Many of these young, ambitious traders look to the internet to learn how to profit from their trades. 

Traditionally, investors are used to receiving their learning and tips from newsletters and paid subscriptions to curated sources of information. If they’re not lucky enough to have a mentor to guide them.

And sure, many may look down on the idea of learning from a social networking app. But it’s a source of information and many are using it, including this new wave of Millennial and Zellenial (Gen Z) traders.

How much can you trust TikTok for trading 

As an app TikTok doesn’t exclusively host traders. Unlike a social trading platform, social media platforms’ objectives are to simply connect people to family, friends, and like-minded strangers.

TikTok as a social media app is very entertaining, but can you trust the trading tips some users offer on it?

While a trading community can come from a social media platform, because its main objective is connecting people, there are some limitations in terms of the quality of information that social media offers.

That being said. A wide variety of users on TikTok offer trading tips. From those looking to earn easy money by taking advantage of inexperienced traders to those that are legitimate and look for exposure to make a name for themselves by helping out.

So what happens when young investors begin seeing tips and tricks on social media apps like TikTok? 

In TikTok, the best content rules and ‘best’ doesn’t always mean quality. People showing off money, cars, and an impressive lifestyle flood trading-related content in TikTok. Although entertaining, witnessing self-proclaimed trading gurus spend money, shouldn’t be considered educational.

On the other hand, there are also people like Kiersten Crum, whose love of the process and long-term success has them sharing their experience on social media platforms like TikTok and Twitter. Like many others, they were naive when they first began and their content is purposed to help people find their process.

The Caveat Emptor or “Buyer beware” principle applies to getting your trading tips from TikTok, or any social media for that matter. You’re left to choose at your own risk since there is no warranty that the information is legitimate

TikTok hosts many talented people looking for exposure; so, how do you find trustworthy advice?

Well, usually go with your gut. If you feel like you’re being sold something you probably are. There are too many times where you’ll see TikTok video titles promising something like that. “These 3 Stocks are GUARANTEED to go up 10,000%”. 

You click on it and the creator rambles on throughout most of the video only to end it by offering a subscription to his weekly stock picks. You might think to yourself “I wouldn’t fall for that”, but you’d be surprised by some of the sales pitches.

There are some other well-intentioned people who offer basic – yet overly emphasized – descriptions of financial concepts. Technical analysis is important for stock picks but you’ll come across videos that make it seem as though it’s a secret tip that no one has previously thought of. 

VIDEO: Professional Financial Advisor reacts to TikTok Trading Tips

Despite there being a very interesting offering of educational content on TikTok, young investors must be cautious as to which extent they follow the aforementioned tips.

The TikTok talent in trading

TikTok has given many a chance at virality, that’s why content creators who want to make part of the creator economy prep their best work for a chance to amass a huge following. So in terms of trading content, there are many great, creative, and trustworthy people. To filter who you should listen to, consider the following:

  • Are you being sold, or taught something?
  • Do they offer content or solutions to problems all they talk about?
  • Is their content really helpful? Or are they talking about something that many others already know, but with this month’s trending song?
  • Check out their trajectory; anyone who has trustworthy advice for stocks has been in the game for a while, or at least they’re honest about their experience.

All in all, transparency is key, if the creators are realistic about their level of experience and offer real value to you – whether it’s entertainment or education – it’s worth following them. Just make sure that you never feel pressured into buying anything and be skeptical about any offers that seem too good to be true.

The term “valuable content” depends on each person’s connotation. That’s why for the purpose of this article, our selected choice of ‘follow-worthy TikTok account’s are only subjective suggestions.

Ricky Gutierrez (@trading101)

Ricky Gutierrez’s bio reads ‘Hustle to Inspire’. And his account shows just that. As a very transparent trader, he shows his good days and bad days. His main objective is to inspire people who view his content to pursue their hustle. 

Ricky is a day trader and real estate investor, he documents his journey and his followers enjoy looking at the process behind his trades. From Sunday night stock picks to live trading sessions his content caters to many.

He has a Learn Plan Profit group, which is paid but besides offering discounts to join he never pushes a sale to join. You can find him on TikTok as @trading101, on Instagram as @rickygutierrezz, and on youtube as Ricky Gutierrez.

Robert Ross @tik.stocks

Robert Ross is a TikTok stock analyst. His content is based on a quick, short technical analysis of market movements with some occasional humorous financial “situations”.

Although some of his humor is parodied by others, they explain basic concepts in an original way. His content caters to new/inexperienced traders, but he offers some useful tips and tools for traders of all experience levels.

Like many others who aspire to get a nice amount of followers, Robert has a Patreon. Those who pay a membership fee have access to view his personal investment portfolio, as well as group chats and more.

The Alternatives: 

Social trading is a form of investing that allows people to copy trading movements from their peers. One of the first and most popularized social trading platforms is eToro which began in 2010. Since then, many other brokers have adapted their own version of a social trading platform in order to accommodate newer younger investors into their business.

Joining social trading platforms is free just like joining social media, so anyone who’s interested in trying them out should create a few accounts and see what they have to offer.

Since social trading platforms are rather new, there are few that have made a name for themselves. Besides eToro’s platform these are some excellent options:

TradeGATEHub

TradeGATEHub is Tradeview’s project for social trading. From live trading sessions to weekly stock picks the TradeGATEHub community gives users the ability to connect with its pros with years of experience.

The TGH community hosts a wide range of industry experts for live interviews continuously (Like the one below with Patrick Karim)

If you would like to join and be part of the TGH community click here.

NAGA 

The European-based fintech company was founded in 2015. Their objective aligns with that of social trading itself which is to decentralize trading technology and market tools for everyone around the world.

One of the neatest features NAGA offers is the constant innovation of its services. From trading education to introducing online gaming items as trading instruments their capability of innovation is amazing.

Final Words

Trading has come a long way. What once was an activity of the elite is now becoming more and more popularized. Social trading is an amazing revelation of the trading industry, being able to connect with others is only the beginning. 

Like social media, social trading platforms will adapt continuously to enhance the trading experience for their users. Each platform will offer distinct and helpful features for its users and only time will tell which platforms will dominate the market.

Tradeview Editorial

6 Qualities of a successful trader

6 Things You Didn’t Know About Successful Traders (Part 2)

Note: This is part two of our two-part series. Make sure you read the first part if you haven’t already. In this article, we will 3 more qualities of a successful trader.

4. Successful Forex traders don’t try too hard

But striving is what it takes, isn’t it?

Not exactly.

This may apply to other areas in life, but Forex is an exception. Successful Forex traders know that trying too hard is an indication that maybe something isn’t right.

This is different from studying a lot. As a new Forex trader, it is highly recommended to study the market.

For example, you can’t spend too much time learning the ins and outs of different currency pairs or how to draw key levels. The harder you try to learn those particular topics, the better.

However, trying too hard make a strategy work will only lead to destructive behavior, such as emotional trading. Similarly, trying too hard to find trading opportunities is a good way to lose money in poor setups.  No one strategy will fit into every situation or setup, sometimes you will be better off waiting rather than entering a trade. 

Jack Schwager, the author of the Market Wizards series, said it best when he wrote, “good trading should be easy.”

I’m a big fan of this book series. In fact, I wrote a publication that presents several of his books.

When I started trading Forex, I remember spending countless hours studying settings over the weekend. I would often come back to my ideas several times on Saturdays and Sundays.

Then, on Monday, most of the time I would end up taking a completely different trading setup just to see how the original idea moved in the desired direction without me.

Sound familiar?

It happened because I was trying too hard. As soon as I stopped over-analyzing the settings and trying to force them to work, my profit curve started to go up.

Now I spend 20 to 30 minutes a day looking at my charts.

As contradictory as it may seem, learning not to try so hard was one of the things that completely changed my Trading career for the better.

5. Think in terms of risk

It is often the smallest things in life that generate the greatest improvements.

The concept of thinking in terms of the value at risk, as it applies to Forex trading, is no exception. It is an extremely simple concept that can have a big impact on your way to becoming a successful Forex trader.

I have never met a successful Forex trader who does not calculate what is at risk before entering a position.
Photo by Lukas from Pexels

You may think it’s an obvious statement, but a surprising number of traders don’t think about how much money is at risk before opening a trade.

This is because they are using an arbitrary percentage to calculate risk, such as one or two percent of the value in their trading account.

Think about your last trade for a moment. Did you define the exact amount in dollars at risk before performing the trade? Or were you more focused on the number of pips and the percentage of your account at risk?

The convenience of Forex position size calculators has made us never have to consider the amount in dollars at risk. This convenience has led to great carelessness.

Don’t get me wrong, I use the position size calculator before every trade.

However, I am just as interested in the amount in dollars at risk as in the percentage of my account balance.

Aren’t they the same?

Yes and no.

Obviously, 2% of $5,000 is $100. In that sense, 2% and $100 are essentially the same.

Without a doubt in terms of how our mind perceives these two figures, they are at opposite ends of the spectrum.

It is important to think in terms of money being risked as well as pips or percentages.

This is because pips and percentages do not represent emotional value. So, when you define your risk in a trade only as a percentage, it activates the logical side of your brain and leaves the emotional side looking for more.

When you calculate your risk only as a percentage, you are defining your risk but do not accept it.

As soon as you convert that percentage into a dollar amount, your mind can visualize what $100 looks like. This allows you to determine if you are prepared to lose that $100. In other words, does the trading setup look good enough for you to risk $100?

It’s much easier to risk 2% without fully accepting the potential loss because it doesn’t have the emotional value of money.

The best Forex traders know that. That’s why they always define their risk in terms of a percentage and a dollar amount.

6. Don’t need the money

There are not many guarantees in the Forex market. But one guarantee I can make is that there is no successful Forex Trader who is trading today to generate the money they need tomorrow.

In other words, trading Forex to earn a certain amount of money over a specific time period.

I’m not saying I can’t generate most of your revenue by trading Forex and do it full-time. Such a statement would contradict my own experience.

What I’m saying is that no successful Forex trader needs a profit today to pay the light bill tomorrow.

No Trader can withstand that type of pressure and be consistently profitable. Such an environment will only foster destructive emotions such as fear and greed.

This theme brings us back to the notion that the best Forex traders don’t try too hard.

If you need the money to pay the bills, you’re likely to feel pressured to win all the time. If you feel pressured to win, you will hardly try too hard instead of allowing the market to do the heavy lifting.

The conclusion is as follows…

You should only trade with money you are willing to lose. Do not trade with the money you need to pay the rent or provide for you or your family.  You need to have capital available that can be put at risk.

Similarly, don’t let money be your only reason to trade. The desire for money is probably what attracted you to trading in the first place, but don’t let it be your only wish.

Accept the challenge and focus on the journey to become a successful Forex Trader and the money will come.

Let money be the byproduct of good trading.

Last words

Whether you’ve been trading Forex for a month or five years, I hope the six attributes of successful traders you just read will help you on your journey.

The most important conclusion is that there is no secret to success in trading. Clearly, there are several tips that can help you, but those who have made consistent profits are not magical.

In other words, there’s nothing you can’t replicate, but it is not always easy.

However, if you intend to rise through the ranks and join the club of the best successful traders, you should be prepared to work and spend the time necessary to succeed.

Embrace the journey, because there isn’t a defined end to this process. Even those who have achieved success have more to learn.

Juan Arango

Senior Analyst
jarango@tvmarkets.com

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