A Guide to the Best Day Trading Forex Strategies
Day Trading is simply the name given to any type of Forex trade which is executed on any one given day of the week, on which the expiry time of that trade is on the very same day.
Whilst it is possible to place a Forex trade to expire in several days, weeks or even months many traders prefer to only have live trades open which are going to expire on the same day, to allow them to hopefully make a profit over the short term.
In this guide we are going to be looking at ways that you can put into place your own unique day trading strategy whilst ensuring you have both a stop loss limit and also a winning goal.
The aim of placing any Forex trade is of course the end that trade in profit, however by always having a stop loss goal you will always known in advance the element of risk involved in any day trading session and how much you could lose if things do not go your way.
With that in mind please do read on and pay careful attention to each section of this guide, for with some experience in trading your chosen currencies and also having a well thought out trading strategy day trading can be very profitable.
Step by Step Guide to Forex Day Trading
By following our step by step guide below we feel that many first time and inexperienced Forex traders are going to quickly and easily be able to put together their own day trading strategy.
However, please do take a look at some of our addition Forex trading guides which will compliment this guide and give you additional information on every aspect of trading currencies.
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Researching Your Currency Pairings
You will of course need to know just which currency parings to have in any Forex trade you place, and this is where a lot of research needed in regards to understanding just which currencies are liking to rise in value or fall in value over any given time period.
One way that many successful Forex traders will be selecting their currency pairings is by trying to correctly predict the outcome of data released via several counties which they do in line with their economic calendars.
This is a time and day of the week when all major countries will announce just how well one or more market sectors are performing within that country. Please do visit our section of the Traders Bible website for an overview of Economic Calendars and how they will be of great use to all Forex traders.
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Expiry Times
Being trades that have an expiry time of no longer than one single day you will also need to carefully select the type of Forex trade you wish to place, in regards to the expiry times of those trades.
You are going to be able to place trades that can last seconds, minutes or an entire day and with that in mind think long and hard as to how long you wish to have your trades live and active for.
Whilst many traders will opt for long expiry time trades, you can often lock in a very quick profit when placing for example a 60 second trade, more so in the time period after a country has released economic data as mentioned above.
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Stop Loss and Winning Goal
One aspect to you trading Forex online or via a mobile trading platform is that you will need to have your own stop loss limit and also a winning goal in mind. However, both of those two factors are always going to be determined by your actual trading budget.
One way of choosing how much to have as your stop loss limit is to base the financial value of each trade you place to no more than 5 to 10 percentage of your trading budget, whilst also having the same amount as your winning trading financial goal.
If you have a trading budget allocated to any days trading of say 100.00, then aim to increase it by 5.00 to 10.00, whilst also having the same amount in mind as your stop loss limit. If on any day trading session you increase your trading funds by that amount then stop trading to lock in that profit.
If on the other hand you place a series of losing Forex trades and your trading budget drops by the same value, then stop trading for the day and mark that session down as a losing
