It's possible to trade profitably on the Forex, the nearly $2 trillion worldwide currency exchange market. But the odds are against you, even more so if you don't prepare and plan your trades. According to a 2014 Bloomberg report, several analyses of retail Forex trading, including one by the National Futures Association (NFA), the industry's regulatory body, concluded that more than two out of three Forex traders lose money.
This suggests that self-education and caution are recommended. Here are some approaches that may improve your odds of taking a profit.
Prepare Before You Begin Trading
Because the Forex market is highly leveraged -- as much as 50 to 1 -- it can have the same appeal as buying a lottery ticket: some small chance of making a killing. This, however, isn't trading; it's gambling, with the odds long against you.
A better way of entering the Forex market is to carefully prepare. Beginning with a practice account is helpful and risk-free. While you're trading in your practice account, read the most frequently recommended Forex trading books, among them
Currency Forecasting: A Guide to Fundamental and Technical Models of Exchange Rate Determination, by Michael R. Rosenberg is short, not too sweet and highly admired introduction to the Forex market.
Forex Strategies: Best Forex Strategies for High Profits and Reduced Risk, by Matthew Maybury is an excellent introduction to Forex trading.
The Little Book of Currency Trading: How to Make Big Profits in the World of Forex, by Kathy Lien is another concise introduction that has stood the test of time.
All three are available on Amazon. Rosenberg's book, unfortunately, is pricey, but it's widely available in public libraries. "Trading in the Zone: Master the Market with Confidence, Discipline and a Winning Attitude," by Mark Douglas is another good book that's available on Amazon, and, again, somewhat pricey, although the Kindle edition is not.
Use the information gained from your reading to plan your trades before plunging in. The more you change your plan, the more you end up in trouble and the less likely that elusive forex profit will end up in your pocket.
Diversify and Limit Your Risks
Two strategies that belong in every trader's arsenal are:
Diversification: Traders who execute many small traders, particularly in different markets where the correlation between markets is low, have a better chance of making a profit. Putting all your money in one big trade is always a bad idea.
Familiarize yourself with ways guaranteeing a profit on an already profitable order, such as a trailing stop, and of limiting losses using stop and limit orders. These strategies and more are covered in the recommended books. Novice traders often make the mistake of concentrating on how to win; it's even more important to understand how to limit your losses.
Be Patient
Forex traders, particularly beginners, are prone to getting nervous if a trade does not go their way immediately, or if the trade goes into a little profit they get itchy to pull the plug and walk away with a small profit that could have been a significant profit with little downside risk using appropriate risk reduction strategies.
In "On Any Given Sunday," Al Pacino reminds us that "football is a game of inches." That's a winning attitude in the Forex market as well. Remember that you are going to win some trades and lose others. Take satisfaction in the accumulation of a few more wins than losses. Over time, that could make you rich!
Healthy Zuppa Toscana (Whole30, Paleo, Dairy Free)
This Whole30 healthy zuppa toscana is rich and creamy, spicy, and absolutely bursting with flavor. You’ll love this filling, Whole30 soup anytime, but especially during cold, wintry months. Dairy free, gluten free, grain free, and sugar free, this is one of the best Whole30 soups out there and my favorite healthy soup!
A rich, creamy, filling zuppa toscana that's healthy and Whole30. With tender potatoes, kale, easy homemade Italian sausage, and bacon, this Whole30 soup recipe is loaded with flavor and the perfect one-pot meal.
Ingredients
- 4 slices Whole30-compliant bacon , cut into about 1/2" pieces
- 1 pound Italian sausage , made from below recipe or storebought
- 1/2 teaspoons crushed red pepper flakes
- 4 medium yellow potatoes , about 1 pound 3 ounces, diced into bite-sized pieces
- 1 medium white or yellow onion , diced
- 2 tablespoons garlic , minced, about 4 cloves
- 4 cups chicken stock
- 1/2 bunch kale , stems removed and leaves chopped, 4 cups
- 1 can coconut milk
- Salt and pepper , to taste
- Homemade Whole30 Italian Sausage
- 1 pound ground pork
- 1 tablespoon red wine vinegar
- 1 teaspoon salt
- 1 teaspoon black pepper
- 1 tablespoon fresh chopped parsley or 2 teaspoons dried
- 1 teaspoon garlic powder
- 1 teaspoon onion powder
- 1 teaspoon dried basil
- 1 teaspoon paprika
- 1 teaspoon red pepper flakes
- 1/4 teaspoon ground fennel seed optional
- pinch dried oregano
- pinch dried thyme
Instructions
- If making Italian sausage: combine all ingredients in a bowl and mix well. Alternately, combine all ingredients in saucepan and stir well when browning.
- In a Dutch oven or heavy-bottomed medium pot over medium heat, add Italian sausage and sprinkle crushed red pepper flakes over. Use a spoon to break up the pieces. When browned and cooked through, drain and set aside.
- Cook the bacon pieces in the same Dutch oven over medium heat until crisp, about 5-10 minutes. Remove the crisp bacon and set aside - don't get rid of the bacon fat! Stir in the onions and garlic; cook until onions are soft and translucent, about 5 minutes.
- Pour the chicken broth into the Dutch oven with the onions and garlic, and bring to a boil over high heat. Add the potatoes, and boil until fork tender, about 10-20 minutes. Reduce the heat to medium and stir in the coconut milk and the cooked sausage; heat through. Add the bacon and the kale into the soup just before serving and cook 'til the kale is bright green and softened. Add salt and pepper to taste.
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