Best Practices for Day Trading Forex in Singapore
Short term trading of currencies has become a common practice in Singapore for traders who believe that the fx rates are likely to change within the same trading day. This means a situation where a trader enters into a position, and then closes it before the trading session ends on the same day. There are certain benefits of day trading, however, one needs to possess tricks, patience and proper planning in order to gain at it.
Economic trends are crucial for day trading and so it is important to study the market appropriately. Forex markets are open twenty-four hours a day but their trading intensity is higher during one time of the day than at other times. This is especially true if trading in the Asian session, which also incorporates Singapore, because the Japanese Yen, Australian Dollar and Singapore Dollar tend to fluctuate quite a lot during those trading sessions. The trader can then identify the best trades by determining the high-liquidity and high-volatility periods for the trading instrument.
A worthy and credible forex broker in Singapore is a strong ally for any day trader. The broker allows quick order completion, narrow spreads, and profound trading platforms. These factors are very important especially to the day trader because they trade more than once in a day. It also preserves your money and guarantees that trading terms are fair so that you do not have to worry about anything apart from your plan.
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Technical analysis is used in day trading to a great extent. Other successful mechanics include the use of charts and indicators to work the trends, the level of support and resistance, and areas of potential exit signals. A number of indicators like moving averages, MACD, stochastic oscillators are used to offer faster and better decisions. Knowledge of these tools gives the trader capability to manage market’s fluctuations in real time.
Risk management can be named one of the pillars of day trading, along with technical and fundamental analysis. However, such a style of trading entails high speed, and as usually with high speeds, losses are likely to pile up in case of poor regulatory mechanisms being applied. The use of stop-loss orders and limitation of the percentage of invested capital per trade can also assist with it. One must not allow themselves to be swayed by emotions and thus losing money, it is also detrimental to lose money; therefore sticking to the money loss plan is also paramount.
It is also important for Singapore’s day traders to be aware of economic events and news. News developments like the central bank interest rate, GDP, and employment numbers are well-known events that cause shifts in the market. Having plans that will ensure that you trade at these periods can increase your chances of getting gains from fluctuations on price more than having to deal with the unnecessary risks involved in trading.
Adherence to discipline and schedule is an important aspect of day trading even for the long-term trader. We should not lose sight of the big picture and focus on the speed of trades because speed is what generates excessive profits. It is often wise to take time and look at the trade history of the particular asset class for that particular session. Such an approach can gradually finesse the overall strategy you take while learning on the job.
There are some risks and rewards associated with day trading forex in Singapore. A trader in Singapore needs to work with a reliable forex broker in Singapore, use technical analysis, and have strong risk management to make decisions in the Forex market. However, with proper commitment and proper plan, day trading can turn into a lucrative business in Singapore’s active forex market.
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