The forex market can very volatile and uncertain. You might be new to the trading business but this doesn’t mean you will lose money all the time. Many traders in Hong Kong have changed their life just by learning to trade the Forex market. Being a new trader, you should focus on long term goals and trade the market with proper discipline. Things might be a little bit challenging at the initial stage but once you learn to deal with the volatility, you won’t have to lose too many trades.
Volatility in the market
The naïve traders don’t understand the concept of volatility. They are just placing random trades with the hope that they will make a big profit from this market. But things are not as easy as it seems. At times you will see the price movement is stable in the major pairs. You will be able to make a decent profit without having any high-risk exposure. But all of a sudden the market might start behaving abnormally and you will lose the trades. Such wild movement of the price is known as market volatility. If you intend to become a fulltime trader, make sure you are not trading the market in an extremely volatile situation.
Trading the volatile market
What if you want to trade the volatile market? Trading can be done with precision even in the volatile market. But for that, you must learn the INS and OUT of the Forex trading industry. First of all, learn to analyze the key reason for which the market becomes unstable. Most of the time, fundamental factors are the key reason for having such a highly volatile market. Things are not as hard as it seems. Since the traders start dealing with the market without having enough skills, they lose their investment. But if you educate yourself properly, it won’t take much time to master the art of trading.
Trade with tight stops
During the market volatility, traders often think trading with wide stops is the only way to make a profit. But if this was true, the majority of the rookie traders would have made a profit in such market conditions. If you start trading the market with a wide stop, and you are trading with high risk. To reduce the risk in trading, you must learn to trade this market with tight stops. And for that, you must educate yourself and demo trade the market.
Look for the price action signal
Price action trading strategy is one of the most effective ways to trade the volatile market. The new traders are losing most of the trades since they don’t know the perfect way to deal with the volatile market. The market remains uncertain to the new traders since they don’t understand the perfect way to analyze the candlesticks. You must develop your price action trading skills to deal with the dynamic market. Once you master the art of price action trading, you are not going to have a tough time in the Forex market.
Analyze the news
Analyzing the news is one of the most effective ways to make a profit in the Forex market. The aggressive traders are placing trades based on technical data only. But if you look at the experienced and elite traders at Saxo, you will be surprised to know the depth of knowledge in the trading industry. They are never placing the trades with high risk. Being a new trader, you should remember the fact, trading is all about finding the perfect trades with low risk. And to do that, you must analyze the major news. Once you start to place the orders by analyzing the major news, you will start seeing the change in your trading performance. So, learn about the news analysis if to trade the uncertain market with a high level of accuracy. And never get greedy at trading.