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Pocket Option Currency trading Strategy and Tips

Currency trading advice from 10 years experience at Pocket Option

Trading currencies is all about making money and losing money. Did you know that 90% of people who trade lose money? Or that almost 80% of people give up in the first two years when they fail?

The business of trading is not always easy. As a trader, it’s your job to learn, grow, and improve your skills so you don’t end up in that 80 percent. Here, I talk about what I’ve learned about the currency market over the last 10 years.

Do not rely on overbought and oversold levels in the long term

This is the first thing I’ve learned so far. When I first started trading, I read a lot of information about the overbought and oversold levels. I learned there that prices will soon go down if there are too many new buyers on the market and it reaches the “overbought” level. In the same way, prices will go up if there are too many sellers on the market and it gets to the point where it is “oversold.”

I lost a lot of money before I realized that this is not how the market works. When overbought or oversold levels are reached, it doesn’t always mean that the price will change direction.

It is possible for the market to stay in an overbought or oversold state for a long time—days, weeks, or even months. In the chart above, you can see that the RSI reaches 30 and sometimes goes above it. Many traders think that this is the time to get into a long position. But you can see that the market is still going down in the long run.

The right thing to do is not to chase the overbought and oversold levels. There will be ten false signals from RSI or the stochastic oscillator about these areas for every real one. I stopped paying attention to the overbought and oversold levels a long time ago because of this. There are no regrets.

EMA(200) is the only moving average you need

Most likely, a lot of new traders are making the same mistake I did when I first started trading. I was using charts with several indicators. I added five or six indicators to the chart one week. It didn’t help me at all. So the following week, I got rid of those indicators and added a few others. … and so on.

What’s that? It did not work. The last thing I did was take off all the indicators from the chart. 200 EMA was the only one left.

200 EMA turned out to be a very reliable tool when trends were happening. It is very helpful for figuring out long-term trends and can be used to find possible levels of support and resistance.

Technical analysis uses 200 EMA a lot because large institutions like banks and hedge funds use it a lot. When you look at EMA on any currency pair or cryptocurrency, you’ll know right away what its value is.

Do not stick to your demo account for too long

We do recommend that you start with your demo account. But don’t cling to it too much. Even if you did great trading on your practice account, it doesn’t mean you will do well on your real account. Being aware that you are trading real money has a big effect on how you decide what to do.

Move on to the real account when you feel comfortable enough trading on the demo account, when you have tried out your strategies and learned how to read signals. But start small, because the emotional pressure of putting real money at risk might make you make bad decisions. Even cents can be traded, not just dollars.

Over time, you’ll get used to the idea that real money is on the line. Then you’ll be ready to start investing more money.

Losing money is a part of the game

Trading is not as simple as it might seem. But you can learn how to play, and every time you do, you get better. Money can be lost in this game. Failure could teach you some important lessons.

Okay, I know that losing is neither funny nor fun. To be honest, it will probably be a very bad time. But if you think about the bigger picture, you’ll be able to get through it.
The most important thing is to find out what you can from this. To figure out what went wrong and not do it again. Every mistake you make makes you smarter. It might keep you from losing more in the future.

It’s important to make sure the plan fits your personality. I once did something like this, and it cost me a lot of money.

When I first started trading, I found an online course about scalping. They make sure that most people succeed. I was interested. After following their plan for a few weeks, I had 20% less money in my account.

It was not the strategy itself that was wrong. The problem was that my needs were not taken into account. I didn’t want to sit at the computer all day. I didn’t want to keep a close eye on how the price changed. I just didn’t like how fast-paced trading was with this strategy.

I couldn’t be a good scalper because it didn’t fit with who I am. I think you should figure out what you like and how willing you are to take risks. Find out if you are a day trader, a position trader, a swing trader, or even a scalper.

Protect your capital

As has already been said, you should pick a strategy that fits with who you are. If you’re having trouble with this, focus on the tools and signs that you find easiest to use. This easy tip will help you come up with the right plan.

Now that you have the best plan, you should keep your attention on protecting your capital. Think about how much you can lose before you think about how much you can make. This is the key to being a good trader. After all, if you are out of the game, you can’t win.

To stay in the game for a long time, you need to keep your capital. Only then will you be able to see how well the strategy worked or if it needs to be changed.

At the beginning of my career as a trader, I was a person who thought like a gambler. I was thinking about the prize and how much money I would win. I was way too optimistic about the loss. And that was a bad thing to do.

So, when you start trading, you shouldn’t ask yourself when you’ll start making money. It should be more about how to trade and keep your money safe, as well as how to deal with losses, so that you can still be in the game a month or a year from now.

My advice is to learn about the market while keeping your money safe. If you reach a point where you know you won’t lose money, you’ll be better off than 90% of traders.

Here, I gave you some advice based on the 10 years I’ve spent trading. I made those same mistakes, so I can tell you how to avoid them. I had both good and bad times. I still sometimes lose trades or think twice before making a trade. Do not get discouraged. Just keep going, and you’ll get there.

 

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