If you are trying to supplement your income, you should consider becoming a part-time forex trader. Why is it a good idea? How much time will it take? Even if you have a full-time job, you will need a few hours a day to trade in this financially attractive market. Are you excited? Check out some useful information to succeed in this trading adventure.
Ways to Success in Forex Trading
The key to success in the forex market is to have a good knowledge of the currency pairs and use strategies that don't require constant monitoring. An automated online broker such as AMarkets or Dukascopy may be the best way to accomplish this, especially for new traders or those with a lack of experience. Three ways to hone your competence as a part-time trader include:
- Find the right assets for trading.
While forex trading can be processed 24/7, the most suitable time for reaching high liquidity is most active market hours. If you have standard working hours from 9 to five, you'll be able to trade either early or late in the day.If you are at the beginning of your trading adventure, trading various foreign currencies is the best option for you. The most popular currency pairs are below. But part-time traders should be very careful with the currencies due to the high liquidity in these pairs.
For part-time traders with extensive experience in trading and more time for research, the following pairs with high liquidity can be advised.
For the part-time traders with a limited trading space, trading only the USD/EUR pair is advised. This pair is most frequently traded and there's a lot of information on these currencies to be found on the Internet.
Also, experts do not recommend part-timers to trade two foreign pairs at the same time, because it requires more knowledge and skills. Don’t ignore this significant nuance!
- Use an automated trading system.
Part-time traders can trade on their own or choose an automated trading platform to make trades for them. There is a variety of automated trading programs with a vast array of functions available on the market: monitoring of currency prices in real time, placement of market orders, recognition of profitable spreads, and many others. Don’t forget that there's no guarantee for the order to be filled on the trading floor at the desired price, especially in a fast-changing market.
If you are a beginner, you should consider using the approach called "set and forget" because it allows the software to proceed with automated actions. A couple of automated programs will take a standard "plug and play" function that is a simple way to start trading. If you are an experienced part-timer, you may prefer a more hands-on trading strategy by choosing automated trading software with more automatic features.
- Proceed with disciplined decisions.
Discipline and dispassion are crucial for success for traders who count on automated systems in making their own decisions. Part-time traders should earn cash through materialization instead of reliance on wider spreads and higher profits. This requires a certain level of self-discipline in fast-changing markets where positive spreads can widen.Successful traders earn money when they can because a trend can turn around instantly due to unpredictable external processes. But those part-time traders with little or no experience should not rush with their decisions. Ideally, they start trading small amounts of currency by increasing them step by step. By opening a mini forex account, traders can “play” with 10,000 currency units without taking any risks.
The potential profits and losses are interrelated with the leverage offered to traders, which can reach 400-to-1. Thanks to leverage, traders can purchase currency lots on margin by processing only a fraction of the cash covered in a currency lot. For instance, you need only $1,000 to trade a currency lot with a value of $100,000 and 1% margin. Don’t get overexcited because you should be aware of the potential risks caused by excessive leverage.
The Bottom Line
On the way to success in forex trading, you should consider principles of discipline, dispassion, and trading appropriate currency pairs. Now that you know the secrets of an efficient part-time forex trader, you need to choose the right forex broker. An automated broker will be the best way to step into online trading, at least until there is a high level of comfort with trading operations.
At the same time, there's no guarantee that you'll make a profit due to the volatile nature of currency markets. Whether you are a beginner or an experienced trader at forex trading, you will have higher chances to earn some cash by following the few principles described above.
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