It's possible to trade profitably on the Forex, the nearly $2 trillion worldwide currency exchange market. But the odds are against you, even more so if you don't prepare and plan your trades. According to a 2014 Bloomberg report, several analyses of retail Forex trading, including one by the National Futures Association (NFA), the industry's regulatory body, concluded that more than two out of three Forex traders lose money.
This suggests that self-education and caution are recommended. Here are some approaches that may improve your odds of taking a profit.
Prepare Before You Begin Trading
Because the Forex market is highly leveraged -- as much as 50 to 1 -- it can have the same appeal as buying a lottery ticket: some small chance of making a killing. This, however, isn't trading; it's gambling, with the odds long against you.
A better way of entering the Forex market is to carefully prepare. Beginning with a practice account is helpful and risk-free. While you're trading in your practice account, read the most frequently recommended Forex trading books, among them
Currency Forecasting: A Guide to Fundamental and Technical Models of Exchange Rate Determination, by Michael R. Rosenberg is short, not too sweet and highly admired introduction to the Forex market.
Forex Strategies: Best Forex Strategies for High Profits and Reduced Risk, by Matthew Maybury is an excellent introduction to Forex trading.
The Little Book of Currency Trading: How to Make Big Profits in the World of Forex, by Kathy Lien is another concise introduction that has stood the test of time.
All three are available on Amazon. Rosenberg's book, unfortunately, is pricey, but it's widely available in public libraries. "Trading in the Zone: Master the Market with Confidence, Discipline and a Winning Attitude," by Mark Douglas is another good book that's available on Amazon, and, again, somewhat pricey, although the Kindle edition is not.
Use the information gained from your reading to plan your trades before plunging in. The more you change your plan, the more you end up in trouble and the less likely that elusive forex profit will end up in your pocket.
Diversify and Limit Your Risks
Two strategies that belong in every trader's arsenal are:
Diversification: Traders who execute many small traders, particularly in different markets where the correlation between markets is low, have a better chance of making a profit. Putting all your money in one big trade is always a bad idea.
Familiarize yourself with ways guaranteeing a profit on an already profitable order, such as a trailing stop, and of limiting losses using stop and limit orders. These strategies and more are covered in the recommended books. Novice traders often make the mistake of concentrating on how to win; it's even more important to understand how to limit your losses.
Be Patient
Forex traders, particularly beginners, are prone to getting nervous if a trade does not go their way immediately, or if the trade goes into a little profit they get itchy to pull the plug and walk away with a small profit that could have been a significant profit with little downside risk using appropriate risk reduction strategies.
In "On Any Given Sunday," Al Pacino reminds us that "football is a game of inches." That's a winning attitude in the Forex market as well. Remember that you are going to win some trades and lose others. Take satisfaction in the accumulation of a few more wins than losses. Over time, that could make you rich!
EASY RICE COOKER PANCAKE
EASY RICE COOKER PANCAKE
This enormous pancake is made in a rice cooker! No need to stand over the stove and flip individual pancakes. Instead, just pour in the batter and let the rice cooker do the work.
To make the cake, whisk your batter, grease the interior of your rice cooker pot, pour in the batter, then set a timer and press cook. When it’s done, the surface will actually be pale and a little wet from the condensation that forms from the rice cooker being closed. But if you touch the cake, it should be firm, and a toothpick inserted will come out clean. The cake will also have pulled away from the edge of the pot slightly. As you let it cool down, the condensation will disappear and the cake will shrink slightly (the last photo in this collage is after the cake had cooled). When you flip the cake over, you’ll find a nice, even brown surface.
RICE COOKER PANCAKE RECIPE
INGREDIENTS:
- 2 cups all purpose flour
- 2 1/2 tsp baking powder
- 2 tbsp granulated white sugar
- 2 large eggs
- 1 1/2 cups low fat milk
DIRECTIONS:
- In a large mixing bowl, whisk together eggs and milk until completely blended. Add in remaining ingredients and whisk until only small lumps remain.
- Grease the interior of your rice cooker pot. I used my 10-cup rice cooker with only a cook/warm function. Pour in the batter. If you have a very small ricer cooker, make sure your batter does not reach past the halfway point since the pancake will rise when cooking. Close your rice cooker. If your rice cooker has a timer function, set it to cook for 45 minutes. If it doesn't, set a separate timer for yourself and then press cook. If your rice cooker only has a cook/warm function, the rice cooker will likely go from cook to warm before the 45 minutes is up (mine did it after 10-15 minutes). You can try pressing cook again, but my rice cooker wouldn't let me. I left it on warm and it continued to cook, finishing at 45 minutes. Your cooking time may vary slightly depending on your rice cooker (size, power, etc). You can check on it periodically. When it is done, the cake will have slightly pulled away from the edges of the pan. The surface may look slightly wet, but it is likely from condensation. When you touch the cake, it should feel firm and bounce back. A toothpick inserted should come out clean. Let cake cool a few minutes. Then invert the cake onto a plate (the cake should slide out easily), and the surface of the cake should be brown.
