Forex Trading System

Forex Trading System

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Creating a perfect forex trading system is nearly to impossible, but to create a good one is something achievable with a little bit of time and effort.

The forex market is usually promoted as the biggest traded market in the world. Whilst this may be the case the reason for choosing forex as your market to trade should be as simple as there are multiple markets within fx and they can be traded cheaply with little or no deposit.

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Designing a good forex trading system requires thought and process. You need to figure out what you want to trade, how you want to trade. You have to figure out what type of trading system are you trying to create? How much risk you are willing to allow? All these things need to be thought out in a systematic way

Just trading randomly in the hope that you will stumble across a winning system is a very dangerous game to play. So what are the basic things to think about?

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Drawdown’s are commonly discussed. You need to think about drawdown’s obviously, but you also need to understand the psychological effects of a string or losses. Ideally you want a smooth equity curve. It will make you more a more confident trader. Also the more smooth the equity curve is the more it will make for a more consistent, predictable trading system.

If you are look at other peoples forex trading systems it is important to check out their equity curve. Look for odd patterns like steep curve suddenly flattening out. This will show you that back tested results are better than forward testing. This is a dead give away to a system that will end up costing you your capital.

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There are many trading tips and tricks that you can use but use them wisely and more importantly use them to create a forex system that suits you.

For help in designing your forex trading system visit GreatTradingSystems.com where you will find articles, indicators and tools to help your forex trading.

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