Basic Tips in Forex Trading

Tip 1 – When trading forex, always make sure to trade with a stop order, not because you expect to lose, but to prevent a large loss from an unexpected news event like a currency devaluation, government coup d'etat, terrorist attack, natural disasters, or whatever.

Tip 2 - New traders to the forex can learn to trade with the less volatile pairs and then move to the more volatile pairs later.

Tip 3 - Trade only with the trend and market momentum. As they say, "the trend is your friend." All currency pairs are trending or oscillating in some form at all times. Trending is a directional move up or down, oscillating is up and down movements going sideways within a range. We usually like to trade in trending movements only.

Tip 4 - If you have any currency pair that has moved strongly in your favor you can close out half of your lots. It is better to have the "money in the bag," than waiting for "potential winning" to come later. the market might go back against your trend later.

Tip 5 - Carry trades are great, these are trades where your objective is a combination of high interest income and some capital appreciation and you intend to hold on for a long period of time. But carry trades are usually done by seasoned traders only.