How to Save an Earning Strategy

What is the Forex Earning Strategy?

Trader (Trader - Trader. Eng.) - stock market trader, speculator who acts on his own initiative and on his own initiative with the aim of profit. This includes trading securities on the stock exchange, certain goods on the commodity markets (oil traders, grain traders, metal traders, etc.), as well as currencies on the foreign exchange market.


When trading, most traders make decisions based on various factors. The main directions of the market trends are technical and fundamental analyzes of the market situation.

The technical analysis is carried out taking into account the indicators built into the trading platform and charting. Fundamental analysis is carried out by following the economic, financial and political events that take place both worldwide and in individual countries.

However, the aforementioned analyzes of the behavior of the foreign exchange market lose all significance without an appropriate and competent management of trading capital. Experience shows that a correctly carried out analysis of the market and the international situation does not always lead the retailer to success. And often the opposite is the case. "How come? - The dealer is at a loss. "After all, I correctly assessed the political and economic situation, which is confirmed by the latest news, I correctly made a trend chart according to the textbook and the price went against me?" And usually, emotional shock, depression, there is a firm belief that Forex is a scam and a trader is leaving the market.

And it happened that the trader did not take into account the structure of the market. Electronic traders (trading over the Internet) account for only 10% of the foreign exchange market with approximately $ 4 trillion in daily turnover. The remaining volume is taken up by large banks, pension funds, corporations, etc., large players.

Now imagine a situation where a trader opened a position to raise the dollar and one of the key players threw billions of dollars into the market, which is why the price suddenly and quickly fell. Many seasoned traders remember situations where the price jumped or fell hundreds of points for 10-15 minutes for no apparent reason and then returned. How could this be foreseen with the help of which analysis? Based on the above, it can be argued that the ability to manage money is most important to a trader.

Here are three basic rules for managing funds:

- Save the deposit;

- achieve a minimum profit;

- to make profit all the time. Here the following is implied. The transaction volume should be such that the deposit can withstand market turbulence. The recommended transaction volume is 0.1% of the deposit amount, the rest of the money serves as a repayment cushion.

In practice it looks like this. Suppose a trader has a deposit of $ 1000. In this case, a $ 1 transaction will be opened. In this scenario the price has to go in the opposite direction of 1000 points to destroy the deposit, which is almost impossible. If the price also goes in the opposite direction, sooner or later it will return and the trader will receive his profit.

Unfortunately, the vast majority of merchants trying to make money all at once are opening transactions that are dangerous to the security of the deposit. And this is the right way to "empty" the reservoir. The only question is time. But that's a question of psychology.