Many of you may be curious about what effective ways to do to get consistent profit in forex trading? One thing is for sure, there is no quick way or shortcut to get profit in forex trading. The most ideal way to get profit in forex trading is to utilize all the insights and theories that you have learned before. However, here are some tips that you can try to get profit when trading forex.

Make a Trading Plan Regularly

An effective way to get consistent profit in forex trading is to start by making a trading plan regularly. Use applications such as Microsoft Excel or Google Spreadsheet to make it easier for you. This trading plan must include detailed information about the currency pair you want to use in the trading time frame, buy and sell conditions, risk and reward ratios, including target profit levels, and stop loss levels.

In this trading plan note, you can also include additional information such as the time of opening and closing positions. Also add information on realized profits and losses. Create a special column or sheet where you will include notes about the factors that make you experience profit or loss. This will be useful evaluation material for your next trading plan strategy.

You should get used to making this trading plan note since you are still practicing using a demo account. That way, you can evaluate the results of your own practice. Recognize the patterns or factors that most often cause losses and profits. Correct mistakes in trading, then try again. While practicing with a demo account, continue to record important notes on the trading plan.

Tips for Creating a Stock and Forex Trading Plan

Implement Capital Mapping

Capital mapping shows how much strength your capital has. You can arrange this capital mapping using the trading plan you have created. In order to function optimally, you must include a realistic profit target, around 10% to 20% each month of the initial capital.

Sometimes it is possible to get a profit of more than 50-100%, but this rarely happens. You cannot make this possibility part of your monthly profit target. That's why include a more realistic target, especially considering your trading skills are not that experienced.

So once again, start from more realistic numbers that are more likely to be achieved. In other words, target your trading profit by adjusting it to the strength of the mapped capital.

Expand the Scope of Opportunities

What often happens in the world of forex trading is that most traders in the market tend to focus on only one type of trading instrument. In forex trading, for example, there is a tendency for a trader (especially a beginner) to only focus on one currency pair during trading. Whereas other options can also bring profit to him.

There is indeed no limit for you to choose how many instruments or currency pairs you want to take, but by focusing on only one currency pair, it actually makes your opportunity to expand your scope even more closed. Your chances of increasing profit are getting smaller. Therefore, try to be more open to other opportunities and not limit yourself to just one currency pair.

Consider the Ideal Risk Ratio

Just as when setting a realistic profit target, you also need to set a reasonable risk (loss) ratio. Keep in mind, the risk in forex trading is directly proportional to the opportunity. So it is clear that you must set the amount of tolerance for possible risks appropriately.

This risk limitation is a way to get profit in forex trading effectively and is regulated in a trading plan. A well-known technique for limiting this risk is by using position sizing. This position sizing means that you are allowed to make transactions comfortably without having to worry about experiencing losses that are too large and can harm you completely. At the same time, you can optimize the existing profit opportunities.

Don't Mix Profit and Capital

Not only applicable to business ventures, as a trader you must also understand the importance of separating profit and capital. This means, when you start trading with an initial capital of 500 Dollars, then after trading you get a profit of 50 Dollars, then what you have to do is immediately withdraw the profit of 50 Dollars. Save the profit you make into a personal account so that your trading account balance is worth 500 Dollars again.

The separation of profit and capital in forex trading aims to avoid the assumption that your capital is still at a safe level when in fact you are experiencing a loss. A simple example is like this. If you do not make a withdrawal when you previously made a profit of 50 Dollars, then the balance in your account is 550 Dollars. Then, one day you experience a loss of 50 Dollars. The balance in your account returns to the initial capital of 500 Dollars and creates the illusion that your capital from the beginning is still fine.

This illusion of feeling safe is what makes many traders complacent and continue trading which risks increasing losses. Instead of getting profit, you actually lose. In fact, if you realize it earlier, you can prevent the loss from happening. Therefore, do not mix your profit and capital.

However, it is different if you really intend to increase the nominal capital in your trading account. If that is the case, not immediately separating profit and capital will not be a problem. However, still apply the principle of withdrawing profit, after you get profit from the capital that you have leveled.

Reasons Why Forex Trading Time Must Be Right

Know When to Stop

Without ignoring the indicators, this way of making a profit in forex trading could be the most important way, namely knowing when to stop. If you are too focused on continuing to make a profit, you could be a fresh bait that attracts traders to continue trading without really analyzing the situation of forex trading price movements in the market. It is not impossible that what happens is that you experience a loss.

For that, you need to remember that stopping does not mean stopping making a profit. But stopping provides an opportunity for impulsive decisions to take control of trading activities. The last point of how to make a profit in forex trading is indeed closely related to trading psychology. That's why you need to be trained to trade with a cool head. Even if you experience a loss because your market analysis turns out to be inaccurate, then taking a break is a healthy option that you can take.

The point is, be disciplined in implementing the trading plan and risk tolerance settings that you have previously designed. Do it with focus. Every time a mistake occurs, take a break to learn trading and do a thorough evaluation before finally returning to forex trading. Make sure your condition is ready. Not only is it effective, this way the potential to get consistent profit becomes even greater.

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