Forex trading is one of the most complex tasks in the world and many professional Aussie traders consider it as one of the most sophisticated business. In order to make money consistently, you need to have a strong knowledge in this industry. But having a perfect knowledge will not make you a profitable trader. You also need to follow strict trading discipline and must have complete control over your emotions. If you think that trading is one of the easiest ways to make money then you are completely wrong. The professional traders at Saxo always use their intellect and trading experience to execute high-quality trades to make a decent profit. There are some certain things that you need to follow very precisely in order to find the perfect trade setup. Since the market is open 24x5, the experts utilize their off day by analyzing the market trend and finding a sweet trading spot. Today we will discuss how to prepare for the upcoming week to find the best possible trade setup.
Study the upcoming high impact news schedule
The forex is extremely volatile and the heavy impact news release tends to intensify the market volatility. As a professional trader, you need to know in which day the important data will be published. But just by knowing the time of the data release will not make your profitable trader rather you should study the possible consequence of that heavy impact news release. For instance, if you see that in the upcoming week the FED is going to announce their interest rate change decision in the FOMC meeting minute then you need to be very much careful while placing trades on USD related pairs. To be precise you must know the severity of the news and its future consequences.
Draw the key support and resistance level
Every single day the market is changing its nature. So being a forex trader you need to draw the perfect support and resistance level based on the most recent swing highs and lows. If you see a trending pair then try to draw a valid trend line since it’s a great way to execute high-quality trades in favor the trend. However some of the novice traders often forcefully join the trend line and thus they face huge loss while placing trades at the trend line support or resistance level. Always remember that a valid trend line will have at least three connecting points. Being a professional trader you must know all your trading tools available in your trading platform to enhance your technical analysis ability. You can also use the Fibonacci retracement tools to find the major retracement level for certain assets.
Find the most volatility and trend pair
The trend is your friend is a well-known proverb in the financial industry. Before the trading week start, you must know which pair is in which trend. If you find that EURUSD pair is in bullish mode (uptrend) then you should only look for buying opportunity. But finding the trend is not the end of the analysis. You also need to find a classic pair which has the highest probability to exhibit an extreme level of volatility. The experts use the fundamental news releases factors to find the market volatility. So make sure that you also learn the art of fundamental analysis or else it will be extremely hard for you to survive the wild swing and false spike. And when you place your trade, make sure that you are not risking more than 3 – 5 Percent in a single trade regardless of the quality of the trade steel.
