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Ways To Improve Your Forex Trading Strategy

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Forex Trading Strategy

Forex trading can be extremely lucrative – if done correctly. However, most traders exit the market following the first losses out of fear that they will never turn a profit on their investment.

Staying committed to forex trading and constantly working to improve your skills can soon result in you becoming a successful trader. Here are some steps you can take to better your trading strategies.

Define Your Goals

Before you start trading, be clear as to what your ultimate goals as a trader are. These can include performance goals or maybe process-oriented goals. Once you have decided on your goals, you will then be able to choose which trading strategy allows you to meet these goals the best.

After setting your goals, you should also track and measure your progress. This will help you keep a clear eye on your strategy – as you’re tracking the progress, you’ll be able to determine how successful you currently are instead of passively waiting until you reach (or do not reach!) your goals.

Additionally, tracking your goals keeps you accountable and makes it easier for you to change your strategy if and when necessary.

Choose Your Broker Carefully

Nowadays, most forex traders have online brokers. If you are only just entering the forex trading market, you will have to choose a broker to help make online trading easier for you.

When choosing a broker, there are several considerations you should keep in mind. These include what fees they charge, whether certain forex brokers require a minimum deposit before you start investing, and how long (and how expensive) withdrawing funds is. You will also have to consider how easy-to-use their trading platform is and what markets and products you can invest in via their platform.

Determine Your Entry and Exit Points

Entry and exit points are the price points at which you buy and sell a product. The lower the entry point and the higher the exit point, the greater your profits.

Deciding on entry and exit points will make it easier for you to keep the course with a given investment, as you will have a strategy for when you should sell. There are various ways to determine the optimal entry and exit points, including charting pattern entry signals and using trendlines. Aside from allowing you to maintain your commitment to investment, even in challenging times, it also makes it easier for you to exit the investment before it starts to lose value.

As a forex trader, you will need to become comfortable with losing periods. Like all investments, there will be times when it seems like you are losing money rather than making a profit.

Forex Trading Strategy1

However, if you are comfortable with losses, you will be able to stay the course and make a profit over the long term. Additionally, you will become a more refined and skilled trader by keeping to a clear investment strategy. That said, make sure to forward and back-test your strategies before you apply them to the live market, so you reduce the risk of losses.

With practice, focus, and commitment, you’ll soon find that starting as a forex trader is one of the best decisions you have ever made!

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via dipo.olowookere@businesspost.ng

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Economy

BUA Cement Pulls Down Stock Exchange by 0.70%

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BUA Cement

By Dipo Olowookere

The Nigerian Exchange (NGX) Limited depreciated by 0.70 per cent on Friday on the back of a decline in the share prices of BUA Cement and 23 others as investors sold off the stocks to book profit as they weigh their options.

As a result, the All-Share Index (ASI) decreased by 350.53 points to settle at 49,664.07 points compared with the previous day’s value of 50,014.60 points. Also, the market capitalisation fell by N189 billion to close at N26.787 trillion in contrast to N26.976 trillion on Thursday.

Business Post reports that the industrial goods sector suffered the heaviest loss on Thursday, depreciating by 4.61 per cent and was trailed by the banking counter, which lost 0.19 per cent as the energy space deflated by 0.16 per cent.

However, the consumer goods sector appreciated by 2.82 per cent influenced by gains in the share price of BUA Foods, while the insurance sector gained 1.75 per cent.

BUA Cement lost 9.95 per cent to trade at N52.95, Chams fell by 9.68 per cent to 28 Kobo, Cutix depreciated by 8.89 per cent to N2.05, Ellah Lakes went down by 6.98 per cent to N4.00, while Unity Bank declined by 6.52 per cent to 43 Kobo.

Conversely, BUA Foods topped the gainers’ log after rising by 10.00 per cent to N59.95, NEM Insurance appreciated by 9.98 per cent to N4.41, Courteville expanded by 9.80 per cent to 56 Kobo, Ikeja Hotel rose by 9.48 per cent to N1.27, while Multiverse improved by 8.44 per cent to N2.44.

During the session, investors bought and sold 750.3 million equities worth N5.3 billion in 4,076 deals compared with the 133.6 million equities worth N2.4 billion transacted in 4,292 deals in the earlier trading day, representing a decline in the number of deals by 5.03 per cent and an increase in the trading volume and value by 461.63 per cent and 117.72 per cent respectively.

Capital Hotels was the busiest stock of the session as it sold 478.2 million units valued at N3.4 billion and was trailed by eTranzact, which sold 77.6 million units worth N176.9 million.

Coronation Insurance exchanged 37.1 million units worth N14.9 million, FBN Holdings traded 30.5 million units for N333.2 million, while UBA traded 13.2 million units valued at N92.7 million.

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Economy

Naira Gains, Sells N691/$1 at P2P, N677/$1 at Black Market

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strong dollar demand Naira

By Adedapo Adesanya

The Naira appreciated at the Peer-to-Peer (P2P), Investors and Exporters (I&E) and the parallel market windows of the foreign exchange (FX) market on Friday on the back of an improvement in the supply of forex to the financial markets by the Central Bank of Nigeria (CBN).

The Nigerian currency gained N5 or 0.72 per cent against the United States currency during the trading day to settle at N691/$1 in contrast to the previous session’s value of N696/$1.

Also, in the official market segment, the local currency appreciated by 63 Kobo or 0.15 per cent against the Dollar to close at N429.62/$1 versus Thursday’s exchange rate of N430.25/$1.

It was a similar outcome in the black market, where the domestic currency was strengthened against the greenback during the session byN3 or 0.44 per cent to quote at N677/$1 compared with the previous day’s value of N680/$1.

In the interbank segment of the market, the Naira, however, maintained stability against the British Pound Sterling and the Euro at N513.10/£1 and N433.78/€1 respectively.

Data from FMDQ Securities Exchange showed that on Friday, the value of FX at the Nigerian Autonomous Foreign Exchange Fixing (NAFEX) went down by 20.7 per cent or $12.06 million to $46.31 million from $58.37 million and this helped the strengthening of the Naira at the I&E at the close of business.

Meanwhile, the digital currency market was bullished during the session as nine of the 10 coins tracked by Business Post pointed northwards, with the US Dollar Tether (USDT) closing flat at $1.00.

Solana (SOL) recorded the highest gain of 10.7 per cent to sell at $47.70, Cardano (ADA) grew by 6.4 per cent to trade at $0.5639, Ethereum (ETH) went up by 6.1 per cent to $2,004.73, while Litecoin (LTC) surged by 4.3 per cent to trade at $64.31.

Further, Dogecoin (DOGE) increased by 4.2 per cent to $0.0739, Shiba Inu (SHIB) appreciated by 3.1 per cent to $0.00001272, Bitcoin (BTC) added 2.9 per cent to quote at $24,670.19, Ripple (XRP) recorded a 1.8 per cent rise to trade at $0.3833, while Binance Coin (BNB) rose by 1.5 per cent to sell for $328.85.

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Economy

Unlisted Securities Market Bleeds as NDEP Stocks Fall

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Unlisted Securities Market

By Adedapo Adesanya

Niger Delta Exploration and Production (NDEP) Plc opened the door for the bears to penetrate the NASD Over-the-Counter (OTC) Securities Exchange on Friday.

The unlisted securities market bled by 0.41 per cent on the last trading session of the week as a result of the decline in the share price of NDEP.

Consequently, the market capitalisation of the bourse shrank by N4.08 billion to N1.003 trillion from N1.007 trillion, while the NASD Unlisted Securities Index (NSI) dropped 3.1 basis points to end the day at 762.18 points as against 765.28 points it recorded in the previous session.

Data from the exchange indicated that the stock price of the oil and gas investment company depleted by N22.5 during the session to N209.84 per unit from the previous N232.24 per unit.

It was also observed that the volume of securities traded at the bourse on Friday reduced by 45.5 per cent to 60,475 units from 111,021 units, while the value of trades increased 179.0 per cent to N7.5 million from N2.7 million, with the number of deals increasing by 44.4 per cent to 13 deals from the nine deals carried out a day earlier.

AG Mortgage Bank Plc remained the most traded stock by volume on a year-to-date basis with a turnover of 2.3 billion units valued at N1.2 billion, while Central Securities Clearing System (CSCS) Plc stood in second place with the sale of 686.5 million units worth N14.2 billion, with Food Concepts Plc in third place with the sake of 147.8 million units valued at N128.4 million.

The most traded stock by value on a year-to-date basis was still CSCS Plc with a turnover of 686.5 million units exchanged for N14.2 billion, while VFD Group Plc was in second place with the sale of 11.1 million units valued at N3.3 billion, with FrieslandCampina WAMCO Nigeria Plc in third place with a turnover of 13.9 million units valued at N1.7 billion.

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