Part-time forex trading can be a productive way to increase your income. There is enough time in a day to trade in this potentially profitable market. even if you work full or part-time.
The way to being successful in forex trading is specializing in currency pairs that are traded when available and using strategies that do not require 24/7 monitoring. A simplified trading platform may be the best way to achieve this, especially for new traders or people with limited experience.
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The ways to hone your skills as a part-time forex trader include:
Find the right pairs to trade.
Although forex trading takes point 24 hours a day during the week, it is best to trade during peak times to ensure liquidity. Liquidity is the ability of a forex trader to sell a position, which is much easier when the market is most active. Assuming you work nine to five, you will be available to trade early or late. Depending on the currency pairs you are trading, there can be a high volume of trades at both ends of these time periods.
For small traders with mini accounts and newbie who lack experience, it is recommended to exchange US currency with various foreign currencies. The vast majority of dollar volume traded in the currency markets is in the following currency pairs. It may be prudent for part-time traders to restrict trading in these fast-trading currencies due to the high liquidity of these pairs.
USDEUR, USDJPY, USDGBP, USDCHF, USDCAD, USDAUD
For part-time traders with a lot of experience and time to research the conditions and circumstances that can affect currency prices, the complying pairs also offer the highest liquidity:
EURGPB, EURJPY, EURCHF
Expert forex traders advise trading only the USD / EUR pair for part-time traders who have a limited trading window. This pair is the most frequently traded, and there is a wealth of information available on these currencies in all media.
On the contrary, experts discourage part-time workers from trading two foreign pairs, which may require more sophisticated knowledge and do not have the same level of information as the USD / EUR pair.
Set up an automated or robotic trading system.
Part-time forex traders can trade on their own or select an automated trading program to trade for them.
There are many automated trading programs available in the market with a full range of functions. Some of them can track currency prices in real-time, place market orders (set limits, market orders, or stop), recognize profitable spreads, and automatically order a trade. Keep in mind that even if a trade is ordered, there is no guarantee that the order will be executed on the trading floor at the expected price, especially in a volatile market that moves quickly.
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A program called “set and forget” may be the best way for the aspiring part-time forex trader to allow the software to create automated decisions. Several automated programs offer a simple plug and play feature, an easy way for beginners to trade part-time. This is one of the important advantages of automated trading – it offers disciplined and dispassionate trading. Experienced part-time employees may prefer a more hands-on approach to trading by opting for automated trading software with more programmable options.
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Take a disciplined approach to decision making.
Discipline and dispassion are essential to traders who reject automated systems to make their own decisions. Part-time traders are advised to make profits as they materialize rather than expecting more full margins and higher profits. This provides a degree of self-discipline in fast emerging markets where favorable spreads can widen. Successful traders profit when they can because the trend can be instantly reversed due to unforeseen external events. Trailing stops and stop orders can be imposed to protect against sudden market reversals and minimize risk. Still, as mentioned above, there is no guarantee that the order will be executed at the expected price.
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Part-time forex traders with little or no experience and skills are advised to start trading small Amounts of currency but with a bigger balance. By creating a mini forex account, which requires less than a standard cash deposit, traders can control 10,000 units of currency (one lot of standard currency controls 100,000 units of currency). The minimum cash deposit for a mini account can start at $ 2,000 and go up to $ 10,000.
The potential gains and losses can be substantial due to the leverage offered to traders, which can be as high as 400: 1. Leverage allows traders to buy lots of Forex on margin, allowing them to invest only a fraction of the funds represented in a lot of Forex. For example, trading a $ 100,000 lot with a 1% margin requires only $ 1,000. However, traders must be aware of the inherent risks associated with the excessive use of leverage.
Dispassion, Discipline, and trading the right currency pairs based on their daily availability are the hallmarks of a successful part-time trader. For newbies, an automated trading program is considered the best way to enter Forex trading, at least until you are more comfortable with the trading procedures.
However, there is no guarantee that you will benefit from the volatility of the currency markets. Smart, knowledgeable, and experienced traders, and even those who are new to Forex trading, will be more likely to profit if they follow a few simple principles outlined above.