Few people will deny that the Forex market is one of the most lucrative financial markets to trade in. With the large daily price trends and market volatility, it is not uncommon for an experienced and successful trader to make hundreds or even thousands of dollars a day.
However, trading in this high leverage and high volatility market does have its potential drawbacks. Although one can potentially make a lot of money in a short period of time, it is equally possible to lose a lot of money within a short period of time too.
The trick to profitable trading is to limit your losses while letting your profits ride.
The Most Consistent Strategy for Profits
There are many traders who like to scalp the Forex market. In other words, they like to enter and exit their trades numerous times a day, each time gaining a small amount of profits. Over a few days or weeks, these small profits start to accumulate to form a large sum of money.
However, such methods of trading require a large amount of effort and concentrate. You'll have to sit in front of your trading terminal for hours upon hours, as you watch intently at each small fluctuation in price. Unless you are a full time trader, this will form of trading will be tough for you to adopt.
A much better (and consistently) strategy to adopt when trading Forex is to trade on breakouts. There are various forms of breakout strategies, but they generally all work on the same premise: prices cannot keep ranging forever. The moment there is a price break (either upwards or downwards) from a market consolidation, huge profits can be usually be captured. All you'll have to do is to place your relevant buy or sell stop orders, and you can just step away from the computer and go about your daily routine.
This form of trading is much more consistent, easy to implement and potentially much more profitable.
To learn more, Click Here to download my free 26-page guide, Forex Trading Traps!
Harold Hsu is the owner of ForexSystemProfits.com where he provides premium Forex trading tips and resources.
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