Important steps to become an effective trader
So, you have decided to take the plunge into trading; while it is a good thing to look at alternate avenues to supplement your income if you know nothing about it you will be flabbergasted with the sheer volume of articles on “How to Trade,” “When to Trade,” and so on. The internet is flooded with articles on indicators and strategies and entry point and exit point etc. It is a daunting and mind-boggling experience to the newbie to the field.
Here are the required steps that will smoothen the path for your entry into the world of trading.
To begin with, you must have a trade setup. What is a setup and how will it help you? A trade setup is a set of conditions that you establish before entering into any kind of trading; only when these conditions are met should you trade. A setup gives you the advantage of being ahead of the market and not too perturbed with what goes on it – the price change, the news etc. because when your setup is met you can go ahead and trade. This minimizes losses.
The drawback to this technique though is it that it requires immense focus and concentration and not all setups are met each day. So, either you have to wait for a long time for your setup to surface or increase the width of your securities to meet your setup. And sometimes the best criteria will be with securities that you would never dream of touching. All the same, having a setup in place is a good place to begin.
Once your setup is in place your entry and exit points are more defined. For example, if you have a price in your setup the moment the price breaks out of the setup you know that is your entry point.
It is time to decide whether you will trade or not. It is here that you must weigh your risks and rewards; based on your previous research and your setup you will be in a position to determine if the trade will be successful or not. In case you deem it to be a success you go ahead and execute the trade, otherwise just go back to your setup and work on it.
If you find all this a little confusing and scary you can turn your attention to the popular automated trading platforms like the Ethereum Code. You can browse the internet to gain more knowledge on the software and continue reading about it until you understand how the preprogrammed algorithms work.