Intraday trading: how to increase its efficiency
One of the important questions in trading is the choice of trading method. Some traders prefer quieter trading and choose to trade on a medium term basis . Besides, it takes less time. But, as practice shows, the most popular method of earning on the Forex market is trading inside the day. It allows you to make several transactions per day and achieve a good trading result. Of course, this does not come at once and requires effort, knowledge and experience. Today I would like to make some recommendations on intraday trading. If a trader takes them into account, he will be able to quickly reach the level of profitable trading.
Number of trades
Beginning traders sometimes mistakenly believe that the more orders they open during the trading day, the more you can earn. Actually, the result does not depend on the number of trades. You should enter the market only if you have quality signals . If they’re not there, it’s better to refrain from trading. The desire to always be in the market, as a rule, ends in the loss of funds.
Despite the fact that the trader has a wide choice of currency pairs to trade, you should trade no more than 2-3 trading instruments. Monitoring of currency pairs and their trading practice allows us to quickly assess the market situation and make optimal trading decisions. If you trade with a large number of currency pairs at once, it will reduce trading efficiency.
This type of technical analysis is used by many traders. However, it should be remembered that candlestick analysis shows good results on timeframes from H4 and higher. In-day trading is conducted on TF for not more than an hour. That’s why it’s not recommended to build your strategy on candlestick pattern analysis.
Management compliance in intraday trading should be given special attention. If you do not do this, a few losing trades during the trading day can not only become a serious psychological test, but also lead to the loss of a significant part of the deposit. The risk on each trade should not exceed one percent.
Any trading strategy designed to trade within the day can cause a serious failure if you are not interested in the release schedule of important news. These are hours of very strong and often multidirectional movement. In this case, the conditions laid down in the CU may not work, and open positions will cause losses. The news calendar should be monitored and abstained from trading if important statistics are expected to be published.
In conclusion, I would like to note that in-day trading will only be successful if the trader strictly observes discipline. There should be no spontaneous, emotional decisions. Also, do not leave open orders for the next day in the hope that the situation will change for the better. After the end of the American session it is necessary to close all transactions and have a rest before the beginning of a new trading day which, certainly, will give new possibilities for earnings.