How To Make Money Through Forex – Part Four
Gulf Business reporter Aarti Nagraj tries her luck at trading currencies and shares a daily account of her experience for a week.
Today it finally struck me that forex trading is not as easy as I assumed that it was. Desperate to make money, I lost a bit more. Very little this time, but it was still a loss.
The daily research note from Max Knudsen, the chief market strategist at ADS Securities, indicated a continuing bearish trend today.
But I decided to try my hand at making a quick profit– called scalping– which basically involves taking profits on small price changes.
Being risk-averse, I bought only a 0.02 lot of EUR/USD at 1.23346 today afternoon. Soon after I bought it, the prices dropped. The negative rally continued, but keen to make atleast a tiny profit, I held on. Tired of staring at the charts, I entered a ‘take profit’ figure of 1.23500.
A few hours later, the prices had fallen far below the afternoon levels and were trading near 1.22800. As I was watching, I noticed a strong positive rally, so decided to make a quick profit. I bought a 0.05 lot of EUR/USD at 1.22887, which I was hoping to sell as soon as I made some money.
Unfortunately, the positive rally stopped soon as I bought. Biting my nails, I watched the EUR/USD graph go down. But as soon as the rally turned and the prices went up, I panicked and sold, making a small loss of $0.05. A few seconds more might have got me a tiny profit, but the sale was done.
Despite all the drama, I was still stubborn to see some profits. So I tried once again, buying a 0.05 lot of EUR/USD at 1.22865. And yet again, the downward dip started. I held on, but after 10 minutes, I specified a ‘take profit’ amount of 1.22885, and began writing this article.
And finally, I got lucky. I just checked and saw that I made a profit of $1.00. Not much, but something is better than losing.
On that happy note, here’s the tip for the day from Max: “Don’t try to guess what going to happen. Follow the trends.”
Also read: How To Make Money Through Forex – Part Three