3 Things You Should Include In Your Daily Routine As A Forex Trader

 3 Things You Should Include In Your Daily Routine As A Forex Trader

If you trade the forex markets every single day, you will soon find yourself getting into some kind of routine. I know I did when I used to trade the markets all day long. Nowadays I make time for other things as well, but I still incorporate the same kind of things into my daily routine.

There are three things in particular that I will always try to do at the start of the day, and they are as follows:

1. Check the overnight price action and monitor any open trades
The good thing about trading the 4 hour charts, and using one of my favourite trading methods, is that you don't need to be screen-watching all day long. You can just set your stop loss and your target exit point and let the trade unwind, leaving it to run overnight if necessary.

For that reason it is always important to check the overnight price action when you first switch on your computer in the morning, and monitor any open positions. The overnight price action can often influence your trading plan for the coming day, and you may want to adjust your stop loss and exit point if necessary.

2. Check the long-term trends

Before you start trading, it is always a good idea to take a look at the long-term trends for the various currency pairs that you like to trade. This should give you an idea of which way you should be looking to trade on the shorter time frames.

For example if you are trading the 4 hour chart, then it is always a good idea to look at the price action on the daily chart, identify the current trend and possibly look at some key support and resistance levels.

3. Check which economic data releases are scheduled for the coming day

It is always vitally important that you are aware of any economic data releases that are scheduled for the forthcoming trading day because these can potentially ruin any of your trades in an instant.

The markets don't care about technical patterns, or even support and resistance levels, when a key piece of economic data is released. They simply react to the news, and subsequently there can be some wild swings as a result. In general you don't usually want to have any positions open around the time of one of the more important data announcements.

You can check the economic calendar, which includes the time (and importance) of each data release at Forexpros.com
ForexMarket4you.com

Once you have done these three things, you are good to go. Just make sure that you take a few breaks during the day, and try to get some exercise because sitting at your desk staring at a computer screen all day long is not good for your health.

Source : TheForexArticles

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Sell Eur/Jpy

Sell Eur/Jpy @110.45
T.p 70 pips
S.l 70 Pips

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Why It's Important to Accurately Time Your Trade

Timing is everything in forex. Time it right, you win. Get your timing wrong, your money goes up in smoke.

In a fast paced market with periods of intense volatility like the forex market, timing is essential. There is a saying that “the trend is your friend till it ends”. I will say that the “trend is your enemy if you get in too late”.

Traders are advised to “trade fundamentally, enter technically.” This implies that traders are expected to follow the direction of a high impact news item. But in doing so, traders must use their technical analysis to enter at the right time.

What happens if entries are not timed properly? These are the scenarios that could occur.

1)      Some high impact news hits the news wires and it favors a long trade. You go long, but you discover that the market has spiked by almost 80 pips about a second after news release. Your entry is still pending, waiting for the broker to fulfill it. Too late. Prices are too far gone and you are asked to “REQUOTE”. Not wanting to miss out, you re-enter the market not minding the prices, and your order is instantly fulfilled. Suddenly, the price starts to retrace wildly, and you are stopped out, just in time for the price to resume its move northwards. It’s almost like the market maker was watching you to do you in.



2)      The second scenario is a bit like the first, but instead of a requote, your order is filled at a price so far away from market price, it will take a miracle move in the trade direction to break even, let alone make a profit. Slippage sucks.

Let’s explain the two scenarios. In a high impact news trade, the news feeds are received by the institutional investors before anyone else via premium news services like Bloomberg and Reuters, who charge thousands of dollars a month for this. A team of veteran traders will be waiting to analyze the news and hit the trade buttons fast. The sheer volume of such trades sends the currency price candlesticks spiking. Sometimes the spikes happen even before the retail traders get the same news. As such, any trade entered by a retail trader at this point will most likely not be fulfilled; requotes follow. If a trader enters the trade at this time, he will meet the institutional guys offloading their positions to take profits, and he will get hit by the unavoidable retracement that follows.

The two scenarios are a case of wrong timing at work.

How Can You Accurately Time Your Trades to Avoid Losses?

For news trades, it is pretty obvious here that you should not try mixing it with the big dogs. You will get blown out by the two scenarios I painted again and again. Only enter news trades when the initial madness has died down. Soon, the market will respond in a slower and more purposeful direction to the news trade, as we see here from the Non-Farm Payroll report of June 3, 2011.

Secondly, use pivot points in addition to your other technical indicators to determine if you are still within touching distance of a profit. If a long trade is closer to a resistance than a support level, the chances of that trading making a profit is lower than if the entry was closer to the support level.

There are many tips, but hang on to these two for now.

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