7 min read
1. Learn the basics
Cultivating the habit of learning is a good thing. Learning and relearning is just as important for novice traders as it is for more experienced ones, especially when it comes to the basics. As in any other field, it is difficult or practically impossible to succeed in trading without knowing and understanding the main principles. It is good to read and watch a lot of material on trading. You can explore the IQ Option blog – just use the search box to find articles on any topic that interests you. Learning the basics of trading is a good start.
2. Do some research
Knowledge of the main concepts is the foundation that will enable a trader to move forward. However, knowing the bare minimum is not enough to trade an asset. The market is constantly changing and it is necessary to understand why. After choosing some assets to trade, it pays to do some research on them. Whether it is a stock, a currency pair or even a cryptocurrency, it is always possible to deepen your research, to know the past events that caused their growth or fall and get as much information as possible about them.
"The activity you avoid the most contains your greatest opportunity." – Robin Sharma
3. Consult the news
Nothing is permanent and market conditions can change in the blink of an eye when influential news is released. It is extremely important to read the news and find information relevant to your favorite assets, which can be used to your advantage. The habit of browsing the news in the morning can help traders understand the connection between chart movement and real world events. Staying informed and being up to date with the latest news is a valuable skill for traders and investors.
4. Use technical analysis
Technical analysis is a powerful tool that is widely used by traders. Even new traders get to know at least two or three popular indicators and start implementing them into their strategies. Of course, no indicator can guarantee absolute success, but they help analyze the movement of the market. Choosing and mastering certain metrics can help you improve your strategy, so it's definitely worth looking into.
5. Stick to a trading plan
Another important habit, and arguably very useful, is to write a business plan. Developing a plan that describes all the details of the strategy implemented by a trader is useful for several reasons: it helps to keep the trader's activity organized, to control his behavior and not to let emotions interfere. . It might also be a good practice for impatient traders who tend to risk their capital more than they would like. Keeping a logbook is another way to remember previous transactions and use this experience to improve your business approach.
6. Manage risks
You might think that the most important thing in trading is to make money, but it's actually the opposite: the most important thing is not to lose money. Safeguarding capital and building it slowly, rather than risking it and losing funds, is a skill and a habit that a trader must acquire. There are many tools for managing risk, ranging from writing a trading plan and using stop loss levels to the 2% rule. It's just a matter of choosing what works best for you.
7. Communicate with other traders
Discussing the market with other traders and learning from the experiences of others can be beneficial both in terms of new knowledge and socialization. However, blindly following the advice of others is not a good idea: it can lead to unsuccessful transactions, or even a scam in the worst case. Balance is essential: listen to what others have to say and think about it, but always use your own knowledge and experience to make the final decision.
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NOTE: This article is not investment advice. Any reference to historical price movements or levels is informative and based on external analysis and we do not guarantee that such movements or levels may recur in the future.
In accordance with the requirements of the European Securities and Markets Authority (ESMA), binary and digital options trading is only available to clients classified as professional clients.
GENERAL WARNING AGAINST RISKS
CFDs are complex instruments and come with a high risk of losing money quickly due to leverage.
87% of retail investor accounts lose money when trading CFDs with this provider.
You should ask yourself if you understand how CFDs work and if you can afford to take the high risk of losing your money.
Source: IQOption blog (blog.iqoption.com) 2020-07-27 09:55:23
Article has been translated for informational and promotional purposes. Translations may not be correct and may contain errors we are not responsible for. Please note this article has been translated by using artificial intelligence. If you are having problems to understand article please refer to original article from IQOption blog.