Random Thoughts-Helpful Tips

I had a few random thoughts about the market and thought that I would post them as tips below. I hope they can be beneficial and make sense! 1. Best way to manage risk.

• Always trade with a stop loss.
• Control the size of your trades-Know the Percent of your account to be traded. 5% max, no more than 2% on any one trade.
• How to figure the percent of your account to trade: total account size times by 5% divide by 50 = # of lots. For example, $3000 x 5% = 150 divided by *$50 of margin per mini lot traded gives you 3 max lots at a time traded, with 2 lots traded at any one time. It is better to use 1 lot to start with until you know which way the market is going for sure then add more lots as is appropriate. At first it would be better in one-lot increments or even fractions of lots. When your skill level increases then you may consider increasing the number of lots traded.

MINI ACCOUNTS You can trade micro mini lots (pennies, and dimes)

You will be controlling $10,000 of currency with one lot traded. Leverage 1:200 2. Learn how to get 1 year experience in 30 days.

• F12 or the Simulated Trading.

3. Learn to look at multiple signals. Have a proper amount of information to look at, don’t over analyze.

• Know the direction of the trend on 4-hour chart.
• Look at the MAO for a fresh cross.
• Look at the Hot Lines for a Royal Cross.
• Look at the direction of the trend on a 30 min and 1 hour chart.
• You only need to look at between 100-140 time frames to get the information you need on the trend for that time period, be it 4 hour or 30 minute.

4. Learn how to find a trade, look at one currency and find a trade on another.

• Look at 4-hour trend.
• Drag and drop from the Market Watch.
• Then look at 1 hr and 30 min chart for entry signals.
• Parallel and inverse pairs.
• Parallel pairs over the long term are the GBP/USD and EUR/USD—USD/JPY and USD/CHF.
• Inverse pairs over the long term are the GBP/USD & EUR/USD compared to the USD/JPY & USD/CHF.
• Others currencies with the same symbol in them i.e. all USD, JPY, GBP, AUD, etc. could be inverse or parallel pairs.

5. How to identify major trends. Learn the best times to trade.

• To find a major trend you need to look at the larger time frames: 1 day, 4 hour.
• Check the direction of the hot lines: are they pointing in a 1-2 o'clock direction for an up trend or pointing in a 4-5 o'clock direction for a downtrend.
• Some good times to trade are around news times you can find the time of the major news announcements by going to www.forexfactory.com.

6. Entry and exit signals. 7. How to trade when the market is flat. Learn more than one way to enter the market.

• Look at a 30 min time frame and the daybreak.
• Put some horizontal lines at support and resistance levels.
• Set your alerts to correspond with the horizontal lines you have drawn.
• When the market breaks above or below the support and resistance levels check your signals for an entry point.
• Know the direction of the trend on the 4-hour chart for the strength of the directional move. There can be good moves against the trend but you have to watch for when they end and start to move in the direction of the trend.