Identifying trading opportunities and planning each trade from start to finish is essential to success in currency trading. When you trade currency as an investment tool, remember to:

  • Maintain trading discipline by formulating — and sticking to — a complete trading plan: position size, entry and exit (stop loss and take profit) before you enter a trade.

  • Always trade with a stop-loss order. Decide on the stop loss before you’re in the trade and don’t move it unless it’s to protect profits.

  • Identify trade entry and exit levels in advance through technical analysis.

  • Understand how each currency pair’s prices move and what drives the prices.

  • Determine position size based on the trade setup and your financial risk-management plan.

  • Be patient — currencies move around a lot. Wait for the market to allow you to enter your trade strategy.

After you’ve invested your time, energy, and risk capital in a trade, your work has only just begun. Managing your trade while it’s active is just as important to a successful outcome. Stay alert, be flexible, but stick to your trading plan.