Everyone knows trading is one of the most lucrative professions in today’s world. You might have the best education in the world but this doesn’t mean you will get a decent job. But when it comes to trading, you can earn as much money as you want. Many people in the United Kingdom have changed their life just by trading the live asset. Though we have easy access to the online trading industry, still we need to educate yourself properly to protect our trading capital. Things might seem a little bit challenging at the initial stage but if you follow the basic rules of the investment business, you will never have a tough time in trading.
There are three basic rules which you need to follow to protect your trading capital. If you follow these rules, you will never blow up the trading account. And this will eventually protect your trading capital in the long run. Let’s learn the three amazing technique to protect our trading capital.
Trade with a low leverage account
The new traders are always losing money since they trade the market with high leverage. Leveraged trading is more like trading with high risk. Even with a small trading capital, you can easily execute big lot trades. Being a new trader, it’s really hard to control your emotions and trade the market with proper logic. So, it’s better to trade the market with a low leverage trading account. If you trade with a low leverage trading account, you can’t execute big lot trades even if you want. For this very reason, smart traders in the exchange traded funds industry always prefer to trade the market with brokers like Saxo. Some of you might say it will limit your profit factor to a certain extent. It’s true to a certain extent but considering all the parameters you are most likely to blow up the trading account but using high leverage.
Trade with price action trading strategy
You can’t make any real progress by trading the market indicators. Indicators are nothing but trade filter tools. You have to understand the simple fact, making consistent profit in the Forex market requires extreme knowledge and proper discipline. If you break the rules in your trading system, you are bound to lose money. If you use an indicator based trading system, chances are very high you will lose a decent portion of your investment by using the complicated method. But if you trade the market with the price action confirmation signal, you can easily limit your risk exposure and make a decent profit from this market. Learning the art of price action trading strategy is not all complex. Open a demo account with Saxo and try to trade the market with reliable price action confirmation signal. Once you master this skill, you can easily execute quality trades at any market condition.
Analyzing the high impact news
The rookie traders are losing money since they don’t know the proper way to trade the major news. Being a new trader, you should never execute any trade during the major news release. The market becomes extremely volatile and it became nearly impossible to make a profit at such a market condition. At times it’s better to stay in the sideline rather than losing money on the low-quality trades. Being a currency trader, you might think technical analysis is the king in trading. But in reality, technical analysis is one of the key factors to filter out the best trades. But without doing the fundamental analysis, you are most likely to lose money. Being a rookie trader, you can seek help from the trained traders. Once you understand the importance of fundamental analysis, you will eventually become better at trading. Try master technical and fundamental skills so that you can filter the best trades at any market condition.