Trading in the currency market is not something that you should do every day on a regular basis. In fact, this is the opposite and you should try to do it as less as possible when you can. The professional traders know this and that is the reason they hardly place any trade on the industry. If you look at the novice traders, you will find they are busy with analyzing, knowing the information and placing trades on the market. They spend a hefty amount of their time in their lives in this industry. This article will not tell you why you should not spend much time but it will tell you how you can smartly exit the market when you still can. We are using the phrase “still can’ because many traders find it impossible to exit without losing a significant amount of their investment. We do not want this to happen to you. Trading in this industry is important but what is more important is you know how to exit the market in the right way. Everybody can place a trade but the trader that can exit with the profit at the right time is the winner.
Many traders often say that they are losing money from their profitable trades. Though they know very well about the market structure, they don’t know when to close their trade. Finding the perfect exit point for your trade is very challenging. But if you can learn support and resistance level, things will become very easy for you.
The retail traders might think that complex trading system is the only way to become a profitable trader. They don’t understand the fact that complex trading system will always increase error factors. You should not also follow other people trading strategy. Identify your requirement and based on your needs, develop a simple but effective trading system. Start using the demo trading account and slowly develop your trading strategy. Try to become a long-term trader and ignore the lower time frame to save yourself from the false spike. Unless you trade hit your potential profit level, you should never manually close the trade.
When you have reached your goal
The goal that you should set in this currency market should not be over ambitious. We are happy that you have decided to invest your money in this risky market but that does not mean you are going to gamble this money. Traders do not understand every trade in Forex is the equation of life and death, loss, and profit. There is no randomness and every price have their reasons behind their changes. Your goal should be appropriate with your trading level and you should not try to exceed it. If you are novice trader, making 10 dollars of profit in a week is enough for you. You should be happy and exit the market when you have made this amount. Do not try to hit big and lose the money. If you have made your profit, exit the industry.
When the profit you set has been achieved
Many people get their desired profit in this industry but the reason behind their loss is their greed. They cannot stop their trades and exit the market. They try to let their profit run as long as possible and when the trend changes, they lost the profit. If your desired profit has been achieved, there is no way you should keep this open. Be happy with your small amount as you do not want to lose this money.
When the trend is signaling to change
Before the trend is over, you will notice some changes and unusual patterns on the chart. If these appear, know your time has come to exit the market. It is better to exit trades with small losses than exiting with a big loss in this currency market.