Forex trading offers many opportunities for investing and growing your income considerably.

As you advance in your knowledge of the market and currency trends, mechanisms, and intricacies, you will find yourself making better judgments and earning increasingly more profits with fewer bad calls or losses.

Seasoned traders are privy to some trade secrets that a novice would do well to master early in their trading career.

Secret 1: Trading Hours

The forex market is open 24 hours a day every day of the week. However, there are some hours when the market is more active than other hours. This is of special importance considering that the forex trader makes his or her profits when there are price variations.

Therefore, an inactive market is an unprofitable market while an active market significantly increases your chances of earning optimal profits.

With this in mind, the trader should focus on the three major trading sessions and most especially the hours within which they overlap.

For example, the Tokyo and London Sessions overlap for an hour between 0300hrs and 0400hrs EST while the London and American sessions overlap for four hours between 0800hrs and 1200hrs EST.

The London market is usually the most active as it involves many different countries across Europe, the Middle East, parts of Asia, and parts of Africa. The US market is the second most active and as such, the overlap between these two offers the best time for forex trading.

For the highest profitability hours, a shrewd trader would choose trading at 1000hrs EST.

This is because at this hour, a big number of London traders are making closing bids at the London market while at the same time making their opening bids in the US market.

This action results in a highly volatile market with great price variations that offer potentially high profits.

Secret 2: Only One Method

When you first got interested in forex trading, everyone said you should learn about the forex market, how to read charts, how to use indicators, and how to conduct fundamental and technical analysis.

They were right-but at times it all confuses the novice trader. The best thing to do is to adopt a single strategy using just one or two indicators and avoid complicating yourself with so many indicators flooding your charts.

Your choice of strategy should be simple, clear, and effective to ensure you reap continuous profits without confusion.

Secret 3: Keep a Journal

If you intend to earn consistent profits from long-term forex trading, then you have absolutely no choice but to record all your transactions. A journal detailing your trading history will allow you to analyze and improve your strategy.

Observing the actions you took that resulted in profits and those that resulted in losses informs you of what to do and what not to do in future. A journal provides a continuous learning tool that will greatly sharpen your trading skills.

Secret 4: All in the Charts

Watching Fox News and CNBC and keenly following all those economic reviews may just act to confuse you. So does following a hundred different indicators.

Your best tool for analyzing forex price action is your charts, nothing else. Learn to read and analyze your price charts and act on the information gathered from them.

Do not make the mistake of trading on what you think is going to happen or what some analyst says is going to happen, but just follow your price charts.

Secret 5: Follow Your Plan

You come up with a solid strategy and most times it gives you profits, but like most people, those moments when the profits are unsatisfactory you feel like doing something contrary to your set trading plan, wrong move!

You should endeavor never to make any trades on whims or without any pre-defined plans or reasons. To ensure all your trades are based on rational, sound, objective logic rather than irrational, impulsive emotions, stick to your set plan.

Secret 6: Risk

Everyone has a fear of losing what they have, especially when it comes to money. However, as an investor, you should always keep in mind that risking your money is part of business and you will not gain any profit if you do not risk anything.

As you will learn from this site, www.forextradingbig.com, always factor in the simple truth that there are times when you will occasionally enter into trades that will lose you money, and that is a guarantee.

Do not give up just because you suffered losses in five consecutive trades. Count that as a learning process and a cost of doing business and move on.

Improve on your strategy and study your trading history to find out where you went wrong, then try again. Eventually you will perfect your strategy and you will start earning consistent profits and recover your losses.

Always remember, even as you risk, make sure you have done your homework and the risk is based on facts and not emotions.

Secret 7: Do Not Be Greedy

Though I am including this, it is not a secret. Many forex failures are due to greed and the number one rule for becoming a successful trader is to avoid being greedy.

Many novice traders enter the market dreaming of instant millions in profits. The likelihood of that happening is next to zero, even though it is a possibility.

To avoid succumbing to greed and remaining calm while trading, there are some tips that should prove useful to a forex trader.

• Have a target in mind before entering any trades, then place a stop loss order and a take profit order. Remember to stick to your plan and exit the trade when you hit your set target unless there is a very compelling reason based on the price action on your charts.
• Be satisfied with reasonable profits. If you enter a trade and it goes in your favor, do not be tempted to stay in the trade long after you have hit your take profit level. The prices naturally fluctuate and any hesitation on your part and deviation from your plan may see you losing the profits you already earned or even making a loss on your investment.
• Resist the urge to move the stop loss level further away from the trade entry point. This is a common reaction when a trader sees the trade going against his initial predictions but he keeps the hope that the price will change in his favor.

Summary

When trading forex, you should strive to learn the finer details of what forex trading entails.

The most important factor is to avoid trading on emotions. Trading at optimal times will also give you the opportunity to maximize your profits.

Above all, make records and stick to your plan.