Can You be Part-time and Successful in Forex Trading?

It’s the age old debate between traders, is part time trading really beneficial? Say, you’re a businessman along with being a committed family man and simply do not have the time to constantly be checking on the market and being a full time trader- would that mean that you’re not able to trade at all? Absolutely not! A lot of people tend to trade part time, as a hobby or to gain some benefits, however the question that arises is - could part time trading possibly be more beneficial than full time trading?

Moral Obligations 
Having something to do on the side is almost a necessity, most full time traders don’t realize that by being a full time trader and letting their time slip away by continuously being fixated on a chart and giving it all the importance in the world can have a serious negative impact on their lives.

Taking Time out of Their Schedules to Trade 
Contrary to what most people believe- traders don’t spend all day, gazing at charts and figures (at least most of them don’t) Good part time traders only need around 30-40 minutes each day to trade successfully by only focusing on the daily time frame. Part time traders need to also make sure they look at the daily closing price because through their analytic skills, traders can detect hints or signals from the market that might point towards desirable trade conditions for them, time really isn’t a making or breaking point in trading.

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Mental Forex Accounting

In plain terms, mental accounting is derived from the term ‘mental accounts’ which refers to some people’s method of categorizing money in different capricious classifications and based on those classifications, they decide on the best ways to spend their money.

Mental Accounting in Forex Trading
At times, investors might be hesitant to sell an investment that once had huge profits attached to them but now have only minimal gains up for grabs, during an economic boom, people tend to get accustomed to plenty of profits and when the market correction deflates investor's net worth, they're more cautious  when selling at a smaller profit margin. They create mental compartments for the gains they once had, causing them to wait for the return of the same or more amount of profit.

Advantages and Disadvantages of Mental Forex Accounting
Needless to say, mental forex accounting has the potential to be harmful to the trader as when the trader is constantly subconsciously categorizing all the money he might be making through trading, he might be restricting himself from making use of the money in ways that he wishes to. For example, it might cause the trader to classify inherited money in the ‘windfall revenue’ mental account and would choose to spend it more liberally than the money they put under their ‘paycheck’ mental account, in this way traders tend to treat their money with discrimination while investing.

In conclusion, mental forex account is undeniably a smart method of properly managing your money as a trader and understanding what money belongs where, rather than seeing it all as something that can and should be risked on trade. However what the trader must remember is that no matter what mental account you put a certain amount of money in, there will be no impact on your wealth, because mental accounts are just that- mental.

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How to Make the Most of Stop-loss Orders

When deciding or contemplating about a stock buy most traders tend to forget to pay attention to the little factors in the trade that have the ability to make or break them. The stop loss order is a perfect of example of such a thing; it is a tool that when used effectively can be beneficial to anyone for various different reasons.

What Is a Stop-loss Order?                    
A stop-loss order can be defined as an order that is made with an agent or broker to either buy or sell the stock as soon as it hits a specific price, this is done to do as much damage control to the loss of the investor’s as possible in a small time gap. For example, if you set the stop loss order at 5% percent less than the price you bought your share at, the stock will limit your loss to just that 5% and not any more than that and as soon as at it hits that low, your share will be sold at the going price in the market.

Advantages of a Stop-loss Order
However, no commission price is charged until the stop-loss order has been reached and the stock is ready to be sold, this makes it very much similar to a free insurance program, now you can’t tell me that that doesn’t sound like the best thing in the world.

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Trends are Gifts to Traders

Let’s get one thing straight, if the market had a gender it would be female and it would be a very independent female. It does not belong, answer or yield to anyone for any reason. She does what she wants and the consequences taking place by her actions are beyond her reach and care. No matter how close you think you have gotten to breaking her, she will always throw you an unpredictable turn, whenever you think that you can feel safe by her side, there will always be someone else thinking that they are safer but in reality none of you are. The market has one weakness though, she, like most females, is attracted to shiny things.

Things that seem to be sparkling even momentarily draw the market to them, and those glistening peaks are what traders refer to as trends. It is common sense to know that when a trend is occurring in the market, it creates an attractive trading environment. However, what should also be common sense is that much like a woman’s enthusiasm it won’t last too long. A sensible trader knows how to move around a trend line and make a note of the parts that are important because he knows that just because the line is facing upwards it does not mean that it won’t go down as soon as he click the trade button.

Sensible traders are those actually investing time to get to know how the market works and how long her attention span lasts and are the ones who get far. These traders and investors are looking for business, they understand that dealing with the market isn’t just a way of making some easy and fast money, for them it’s work. Worthwhile traders take the time and study the trends, they know past trends and try to figure out any pattern connections of those trends appear again. They know that when new trends appear they should look into other similar trends and what their outcomes where. Successful traders are recognised by one thing, their analysis.

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What time should you trade Forex?

Traders and investors are often surprised when they realise how many variables forex trading is compiled by. An outsider and very often an actual trader believes that in order to trade in the online forex industry all you need is an account and a trading platform. Some of you may find this as a slightly ridiculous thought to miss whilst others might be asking themselves ‘Well, what else could you possibly need?’. Successful forex trading is only achieved when the trader comes to terms and works with the different variables involved in the game and one of these variables is time.

Everyone is familiar with the phrase ‘time is money’ and in forex trading this couldn’t be any more true. Knowing that different markets are open at hours is basic, knowing what time these markets are mostly affected is what distinguishes professional traders from the average.

To begin with, each trader regardless of whether they are interested in the certain market or not, he is compelled to know the forex trading hours of each, especially because some markets often overlap each other’s and these small windows often open the biggest trading opportunities:

New York 8am to 5pm EST (1pm to 10pm GMT, 3pm to 12am EET)

Tokyo 7pm to 4am EST ( 12am to 9am GMT, 2am to 11am EET)

Sydney 5pm to 2am EST ( 10pm to 7am GMT, 12am to 9am EET)

London 3am to 12pm EST( 8am to 5pm GMT, 10am to 7pm EET)

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Understanding Fundamental Analysis

Fundamental analysis is used in the equities market in order to gauge the true value and to make investments based off of this calculation. Fundamental analysis is also used in the forex market. However, in the forex market, traders generally evaluate currencies and their respective countries in order to decide whether an investment is worth it. Economic announcements made in any country often have a direct impact on the true value of a currency, which is why fundamental analysis is used.

How Does It Work?
A prudent trader generally factors in a variety of different news reports, economic announcements and international factors in every single one of their trade. Political events, economic announcements and other news often leave a very strong impact on certain currencies. Therefore, calculating the true value of a currency is not easy. Obviously, it should be known that the values tend to change with the passage of time. For instance, factors such as economic growth and the financial strength of the company both have a major impact on the true value of a currency.

A trader who follows the fundamental trading strategy will consider these factors when planning his/her approach. However, you should know that there are practically unlimited forex fundamental strategies that are used in the market today. Extrapolating the concept of a fundamental analysis directly on to the forex market is not easy.

Many of the factors and indicators that fundamental analysts use in the stock market are non-existen in the forex market. Moreover, you are not trading stocks with one another: you are trading economies. In every single economy that you trade, there are hundreds of companies trying their best to maximize their profit potential. Therefore, analyzing the statistics of a single company doesn’t provide much insight in to whether an economy is faring well or not.

Things Successful Traders Avoid Saying

Becoming a successful trader in the forex market is not easy. You need to have a certain amount of discipline, ingenuity and a penchant for identifying trends if you want to become successful in the forex market. Most traders in the market often find it difficult to generate profits, simply because they look for big rewards in the short term. Becoming a successful trader in the forex market is all about developing a sense of discipline. However, if you want to take a look in the mentality and mindset of a successful trader, you need to figure out the things that they generally avoid saying. To give you a brief idea, here are some of the statements that a successful trader will never say:

"I don’t take losses"
No successful trader will ever say that. What most people don’t realize is that losses are likely to occur. They are a part of trading. Successful traders know that a major loss is more than likely to wipe out their account completely sooner or later. Therefore, they are always prepared for this. However, what separates a successful trader from an unsuccessful one is their ability to win rather than lose. Successful traders know that losses are a part of trading, and while they try to avoid them as much as possible, they don’t shy away from losses.

"You don’t need to manage money"
You will never hear a successful trader say that they don’t need to manage money while trading. Money management is an essential part of long term trading, and you need to be very careful when deciding the amount of money you are willing to risk on every trade. It is vital to the long term success of your trading portfolio.

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