The most common word which is in every trader’s mouth is that “Forex market is very volatile.” Forex market is volatile because there is always changes in the price level. There is no fixed winner on the market. If there are many successful traders in the market and they are placing trades, you will see that they are not winning every time. It is a random selection of the winner. Traders in the Forex market knows that market volatility can take their money from their account. Successful traders also know that market volatility is the reason they are making money in this market. Can you think of a forex market where the signals are not moving? It is the same signal every day. There is no upward and downward movement.
You may think that your money will not be gone into the market, but it says you will not be making anything from the market. It is not moving. Everything has two sides. Market volatility is bad for the traders who could not understand the Forex market. They lost money in trading CFD. Traders who have understood the market, for example, the Australian day traders, they take the market volatility in their favor. They are the best example how traders can use the market price level of the Forex to make a profit.
Market volatility is what gives money
Traders use analyses to understand, how volatile the market can be. The market can be very volatile and not many traders can trade at that market. It needs mastery. The market can be little volatile and traders always trade on these markets. It is the moving price level on your chart that you are calling market volatility, is giving you money. When you are trading in the Forex, do not expect a flat market. The professional traders at Saxo always make a decent income during high volatility by trading CFD. But this doesn’t mean that you will execute 100 percent winning trades in the market. So make sure that you follow proper risk management factors in every single trade while trading CFD.
Favoring market volatility
Trade the market in favor of the market volatility. If you see that the market is favoring the buyers, place a trade as buyers. If you think the market is going to reward the sellers, trade like a buyer. Do not go on your own. Market volatility is your friend and tells you that you can make money because the market is moving. You just have to wait for your turn in the market and place your trades in the market. If you can use market volatility in your favor, you will be making a good profit in Forex.
Trade in favor of the trend
Most of the novice traders in the forex market loses money in trading since they trade against the long-term prevailing trend in the market. If you look at the professional trader then you will notice that every single one of them is trading the live assets in favor of the long-term prevailing trend to reduce the risk exposure in trading. So when you look for trading signal use the higher time frame and trade in favor of the long-term trend in the market.
Summary: Forex market is an extremely volatile market and if you don’t know how to trade in a volatile situation then you will lose money in trading. The professional traders have spent years after years in mastering the art of trading. So if you truly want to become a profitable trader in the forex market then make sure that you trade the live assets with proper risk management factors. Always look for trading signals in favor of the long-term prevailing trend to reduce the risk exposure in trading.