In order to survive at the forex market you have to limit your losses maximally and make more profit than losses. It is easy, isn't? But why the majority of traders can not comprehend this trader's law? Because of psychology?
Now let's return to the topic of this article, set a goal to take pure 20 pips every day while trading. I know, it sounds really boring. Not so attractive as orders on 100 pips. But you trade to make money and not for fun, don't you? Otherwise you will go broke very soon. Let's fix in our mind that this is a serious business which gives you profit. The newbies should try mini-accounts where one lot has a size 10000 USD.
First I want to discuss with you margin level and how to determine trading leverage. Very often Brokers promote leverage 400:1. If you think that trading with the leverage 400:1 is a good idea you are just a fool. The required guaranteed deposit for position opening will be extremely low. It is not so bad, isn't it? I think that it is good too but it is not always so. Remember that leverage increases not only your profit but losses as well. If you open positions with leverage more than 5:1 it is a way to ruin. In fact you may count your leverage if you correlate the size of opened position with the balance of your account.
For example, if the volume of opened position equals 250000 USD and you have 10000 USD on the balance your leverage is 25:1. The leverage 25:1 is a dangerous level, if you do not want to finish your trading career in several months. As soon as you find your way and start to win you may return to the problem of leverage. Want to start it right now? Follow me to InstaForex's company:
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