Simple Way to Dramatically Improve Your Forex Trading Profits

Forex markets for any period of time you will probably by now have developed your own unique trading system.
However the vast majority of systems could be improved upon and made a lot more profitable just by doing one simple thing. All you want to do is to simply weed out the riskier set-ups that are triggered by your system and only trade the ones most likely to make a profit.

This sounds obvious but let me explain this in more detail. Successful forex trading is all about finding high-probability trading set-ups. Most traders determine whether a particular trade is likely to be a winning one by using a variety of different technical indicators.

If they all agree and suggest that a currency pair is highly likely to go either up or down, then this is a high probability trade. Now if you go over every single one of your trades in the last few weeks you will probably be able to identify those positions which you were not very confident about when you placed the trade. Some of these may have turned out to have been winning positions but some will inevitably have turned out to losing ones.

In fact for a lot of people most losing positions will be those that were taken rashly on instinct or were trades that deviated from the strict rules of the system, so it's important to categorise every set-up to try and weed out these potential losers. You can do this quite easily. All you do is you give each potential trade a ranking out of 10 based on how confident you are the resulting trade will be a winning one. This could be based on your technical indicators, for example, or your past success rate trading similar set-ups.

Then it's simply a case of only trading the high probability set-ups, ie those which you've rated highly. You will probably never rate a potential position 10 out of 10 because no-one can be absolutely sure their position will be a winning one, but you should be able to find lots of 8's and 9's out of 10. These are the ones you should be trading. The other set-ups should be ignored. This simple step, which is extremely easy to do, can be enough to turn an unprofitable trading system into a profitable one so it's well worth your while to quickly analyse each set-up before you press the buy or sell button.