Post by vickymacklean on Sept 21, 2017 18:37:54 GMT 8
Trading in Forex can be hard if you do not know how to use leverage to your advantage. When you are trading in Forex, you have to know that not all traders use leverage in their trading. It is because leverage is a two-sided sword. It can be both good and bad for your trades if you do not know when to use leverage and how much leverage to take in your trades. Do not worry as we are going to tell you how you can use leverage to your advantage. Just remember that you should not use leverage in your very trades and only use this when you are confident of your analysis. Most traders in Forex use leverage either to see how much money they can make in Forex if leverage is used and others use leverage because they know they can make big amount if it is used.
When you are certain of the future trend
One big mistake that all traders make when they are using leverage is they only take leverage when they are certain of the existing trends. This is something that you should never do in Forex. This is not the existing market that you are placing your trades on Forex. This is the live market and it is changing every time. Traders do not understand the concept of existing and live market and they only use leverage when they are certain of the existing trend. You are only going to make a profit when the future trend moves in your favor. Keep that in your mind and you can make a good profit in Forex. If you think the future trend is going to be against you, though the existing trend is in your favor, do not use leverage.
By taking small leverage
Another way to use leverage in your trading so that it does not come back to you is by setting a small leverage. If you set your leverage position from 10 to 20, it will change a lot of your profit and loss. You can either blow up your account or you can be a rich person with one trade. As Forex market is hard to predict traders always take small leverage in their trading and make a profit by using small leverage. Remember using leverage increases your profit by many times and you should not be greedy and take a large leverage. If you are trading CFDs with high leverage then you must remember the fact that you can lose a big amount of money in a single trade.in other words, leverage can act like a double edge sword in the online trading world. However, all the professional traders at Singapore are using the leverage to their advantage and making a huge profit in every single month by using it an effective way.
Use the price action signal while trading with high leverage
Most of the novice traders often use the indicator based trading system to trade the live assets. But using the indicator based trading system is not an effective way to use the high leverage to maximize the profit potential. Most of the indicator based trading strategy requires the use of wide stop loss. But if you learn price action trading system then you can easily trade with precise stop loss and take profit level. When you have your predetermined stop loss in the market you can easily calculate your lot size and aim for a high reward from a single trade. But the use of high leverage trading account is only for the experienced professional. So being a new trader it’s always better to use low leverage since it will minimize your risk in trading. Once you gain enough experience slowly increase your leverage and see how things work for you.
When you are certain of the future trend
One big mistake that all traders make when they are using leverage is they only take leverage when they are certain of the existing trends. This is something that you should never do in Forex. This is not the existing market that you are placing your trades on Forex. This is the live market and it is changing every time. Traders do not understand the concept of existing and live market and they only use leverage when they are certain of the existing trend. You are only going to make a profit when the future trend moves in your favor. Keep that in your mind and you can make a good profit in Forex. If you think the future trend is going to be against you, though the existing trend is in your favor, do not use leverage.
By taking small leverage
Another way to use leverage in your trading so that it does not come back to you is by setting a small leverage. If you set your leverage position from 10 to 20, it will change a lot of your profit and loss. You can either blow up your account or you can be a rich person with one trade. As Forex market is hard to predict traders always take small leverage in their trading and make a profit by using small leverage. Remember using leverage increases your profit by many times and you should not be greedy and take a large leverage. If you are trading CFDs with high leverage then you must remember the fact that you can lose a big amount of money in a single trade.in other words, leverage can act like a double edge sword in the online trading world. However, all the professional traders at Singapore are using the leverage to their advantage and making a huge profit in every single month by using it an effective way.
Use the price action signal while trading with high leverage
Most of the novice traders often use the indicator based trading system to trade the live assets. But using the indicator based trading system is not an effective way to use the high leverage to maximize the profit potential. Most of the indicator based trading strategy requires the use of wide stop loss. But if you learn price action trading system then you can easily trade with precise stop loss and take profit level. When you have your predetermined stop loss in the market you can easily calculate your lot size and aim for a high reward from a single trade. But the use of high leverage trading account is only for the experienced professional. So being a new trader it’s always better to use low leverage since it will minimize your risk in trading. Once you gain enough experience slowly increase your leverage and see how things work for you.