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The number of active retail traders in the online trading community is rising at an exponential rate due to lucrative profit factors of this industry. Even if you trade with a small amount of capital, you can easily place big lot size trades by using a high leverage trading account. Making a huge profit in the online trading industry might sound extremely easy but in real life trading, it requires a great deal of hard work. Most of the novice traders are losing money since they don't know the perfect way to place trades, reflecting the long-term trend. There are some basic rules which the pro traders in the United Kingdom follow to ensure their consistent profit. In today's article, we will give you five amazing steps which will enhance your trading performance.
Trade the daily time frame
Higher time frame trading is always safer as you don't have to deal with lots of false trading signals. Though higher time frame trading can be time consuming, the pro traders always use the daily time frame to create perfect technical analysis. It also helps you to find the high-quality trades in favor of the market trend, which significantly reduces your risk exposure. Try to trade the key support and resistance levels in the daily time frame by using a proper stop loss.
Use the price action confirmation signal
Price action trading strategy is one of the best trading systems in the world. It's nothing but the study of the different formations of the Japanese candlestick pattern. The pro-UK traders use the reliable price action confirmation signal to place their trade with low-risk exposure. Some novice traders might find it hard to memorize all the price action patterns but once you know the psychological reason behind formations of these patterns, everything will become easier for you. But make sure you demo trade the market before you start trading with a live account.
Follow a paper-based trading journal
Everyone makes mistakes in the Forex market. Unlike the novice traders, the pro traders always learn something new from them. So how do we learn from our mistakes? The answer is really simple. You need to follow a paper-based trading journal, so that you can easily review your trading history. All the pro traders assess their trading history during the weekend. Once they identify problems, they change their trading system and strategies to adapt to the dynamic nature of this fast moving market.
Learn to scale your lot size
Scaling your lot size is very crucial to your trading success. If you don't learn the perfect art of trade management it will be almost impossible for you to deal with your losing trades. Make sure you place your trade with low-risk exposure built in. You might have the best trade setup but you should never take more than 3-5% risk in any trade. If you setup a trading strategy with a tight stop loss point, make sure you increase your lot size to enhance your profit factors. Bringing dynamic change to your lot size in live trading is extremely hard. However, once you master this technique you will know how to secure bigger profits, while minimising your risk.
Do the fundamental analysis
The majority of novice traders don't give sufficient importance to fundamental analysis but high impact news data will often be considered as the most powerful price driving catalyst in the Forex market. So if you just learn the precise art of fundamental analysis, you will never catch the big market movement. Most importantly you will never be able to ride the long-term trend with a high level of accuracy. Execute your trades based on fundamental and technical data and never take too much risk, even though you may feel very confident about the trade setup you have established.
