7 Tips and Ways to Play Safe Forex Trading

The forex market provides a great opportunity for anyone to get double the profit. Both novice and experienced traders can access the market with capital starting from just a few tens of dollars. Playing forex trading does not require various means, but simply a laptop or smart phone only.

This very easy market access makes people tend to trade forex trading. They make calculations "definitely profit with open 1 lot per day only" or "profit millions of rupiah with only one trade per month", and so on. In the end, many people suffer losses quickly because it is too reckless and trivializes the market situation.

Playing forex trading is difficult. Experienced traders are certainly familiar with trading activities and able to control risk. But for novice traders, there is much to learn to avoid fatal losses. What are those? Here are seven ways to play forex trading that are safe and profitable:

1. Learn Forex Before Depositing Capital

Never trade forex trading. Learning forex is the first key to unlocking the safe of profit in the future. Novice traders must first learn forex, ranging from how technical trading, a variety of important terms in it, to how to use the online trading platform. After that, beginners need to simulate trading on a demo account and practice analyzing both technical and fundamentals.

During the simulation on a demo account, try to create forex trading strategies and plans starting from the simplest. Practice repeated system testing to ascertain how much win rate and profitability of the trading strategy being tested. Make sure to control the margin according to the leverage used. After all that success, then a newbie can deposit capital to start playing forex on a real account.

2. Choosing a Reputable Regulated Broker

The forex industry covers the international market. In fact, market surveillance is carried out separately by each country. This situation creates many loopholes that can be exploited by irresponsible people. Many fraudsters create websites or offers via social media under the guise of forex. They show off impressive trading results and promise double profits, when in fact they just want to raise members' money.

In order not to get caught with such scams, we must always check the licensing and reputation of forex brokers before opening an account. Do not open an account at an institution just because it is tempted by the lure of profit. Remember, forex brokers are just intermediaries that connect traders with the market. How can an intermediary provide a guaranteed profit!? A broker can provide advanced trading facilities to its customers, but cannot guarantee whether

Traders should choose a regulated forex broker that has permission from official institutions such as the NFA/CFTC (United States), ASIC (Australia), FCA (UK), and its countrymen. Traders also need to googling or finding out the reputation of brokers in online trader forums, to find out how quality trading facilities are provided.

3. Use a Simple Trading System

Many novice traders expect there to be a holy grail indicator that is sure to profit in every trading position. For the sake of that hope, they dabbled in each indicator along with the combinations, until finally the chart screen was filled with images and lines are not clear. In the end, they were confused because the signals each indicator showed were different.

Instead of stacking a lot of indicators on a single chart, traders should use a simple trading system. There are many successful pro traders with just a simple strategy. Importantly, traders must understand price action, be able to read candlesticks, and master the indicators used. Make a beautiful and easy to see chart setting ranging from the color to the chart type, so that we will be able to evaluate the market with just one glance.

4. Use Risk Management

All traders need to denounce one thing: There is no god indicator in this world. All indicators must have accuracy below 100 percent, so there are times when the trade loses. Traders should do risk management to reduce losses and optimize profits, instead of looking for abal-abal god robot.

Risk management techniques are the key to consistent success that is widely applied among pro traders. First of all, we must all recognize that trading can be profitable and can be lost. Don't be afraid of loss or too greedy. Make a logical trading plan according to market conditions. Furthermore, the execution of stop loss (SL) and take profit (TP) levels according to the initial trading plan to keep trading risks under control.

There are people who avoid stop loss and take profit for fear of being spied on by brokers. But actually we do not have to worry about such manipulation if we have joined a reputable regulated forex broker. On the contrary, stop loss and take profit can precisely limit losses when market conditions are contrary to our forecasts.

5. Start Trading Real with Small Capital

 Many sales brokers invite forex trading with capital of tens of millions of rupiah. The reason is, the greater the capital, the greater the profit. But this is just a marketing joke. In fact, forex traders should start trading real with small capital first. If only small capital loses, yes how will it be profitable with large capital!?

Speaking bluntly, trading on a demo account is inadequate in preparing the trader's mentality. Even though we've been practicing demo accounts for months, it can still be a direct loss after logging into a real account. Why is that? Because the psychological condition when trading with money is different from our mental when trading with real money. There are fears of loss, greedy want to quickly profit, and much more. Traders need to learn how to control these negative emotions by starting trading on small capital first.

6. Use Limited Leverage

Many forex brokers offer trading facilities with super high leverage up to 1:1000, 1:3000, or even higher. Very high leverage does allow traders to start trading with less capital. However, high leverage slows down our ability to make a profit. High leverage also carries risks because we can lose more than the initial capital.

To control leverage risk, traders should use only limited leverage. What is the ideal leverage? Any leverage up to a maximum of 1:100. We can use 1:20, 1:50, to 1:100. However, avoid fantastic leverage like 1:1000 and the like.

7. Create a Diary of Daily Forex Trading

Without a note, it is easy to forget the details in our daily life. Similarly in forex playing activities. From the learning and training stage of the demo account, traders should have started to record anything that has been learned and tested. Write down the full date, pair traded, trading techniques used, how much profit/loss, and a record of what is learned from the transaction.

Trading diary like this can help us learn from experience, while avoiding a repeat of the same mistakes in the future. Notes like this will also help us manage forex playing activities like a professional business. In the long run, success can undoubtedly be achieved consistently.