Limiting your Losses and Supercharging your Profits:

The one aspect that many people don’t like to talk about trading is the likelihood of losing money. Well, to be perfectly honest with you, there is a strong chance that you will lose money. There are so many more opportunities to lose money than there is to make money if you do not have a solid trading strategy. However, if you develop a trading strategy grounded in the fundamentals, you can substantially reduce your exposure to losing trades.

It’s important that you set a stop-loss level before you execute your trading strategy for the day. You’re pretty much programming your trading software to automatically dump the trade once you lose a specific amount of money. The goal is to preserve your working capital and have enough of it to add to your profitable trades. Cut your losses on your crappy trades and quickly identify and add to your successful trades. That is the key to limiting your downside exposure and increasing your trading profitability.

External Forex Resources:

Forex Trading Strategy Guide

Forex Educational Materials