Being a forex day trader can be very lucrative. The currency market is by far the most liquid and volatile market in the world and with this come various opportunities.
No matter what type of market you chose to day trade you must know the “personality” of the market you are trading. Every market has it’s own characteristics and it is important to know what they are before attempting to profit from it.
The forex market is no different. In this article we will go over very important general day trading principles/rules and then we will see what a daytrader has to recognize when specifically day trading the forex market.
As the term implies, day traders are concerned with what happens in the market today. Not tomorrow, not next week and not next month, but today.
The day trader’s job is to capture intraday price swings. Depending on the system or trading method employed, this can mean capturing one intraday swing or various intraday swings.
The general job of a day trader is:
To control risk
One of the most important jobs as a day trader is to control your risk exposure. Sure, controlling risk is a concept you must use in any type of trading, however in day trading you must look at this issue from a different angle. Since your job is to capture various price swings during the day naturally your profit objectives will be much smaller then of a swing trader (who places a single trade aiming for a much larger profit objective).
No matter what type of market you chose to day trade you must know the “personality” of the market you are trading. Every market has it’s own characteristics and it is important to know what they are before attempting to profit from it.
The forex market is no different. In this article we will go over very important general day trading principles/rules and then we will see what a daytrader has to recognize when specifically day trading the forex market.
As the term implies, day traders are concerned with what happens in the market today. Not tomorrow, not next week and not next month, but today.
The day trader’s job is to capture intraday price swings. Depending on the system or trading method employed, this can mean capturing one intraday swing or various intraday swings.
The general job of a day trader is:
To control risk
One of the most important jobs as a day trader is to control your risk exposure. Sure, controlling risk is a concept you must use in any type of trading, however in day trading you must look at this issue from a different angle. Since your job is to capture various price swings during the day naturally your profit objectives will be much smaller then of a swing trader (who places a single trade aiming for a much larger profit objective).
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