How To Trade Forex By Signals – Part Two

In How To Trade Forex By Signals – Part One I wrote about choosing a trading signals provider (My personal choice is Millennium Traders) and a forex broker if you don’t have any yet.

Selection is important, but if you want to achieve results, you must actually start trading. Here comes part Two.

Let’s Rock… Start Action!

Once you’ve made your mind about the signal service and the broker/trading platform you are going to use, it’s time to take action. Follow the steps below to reduce the risks and improve your performance.

1. Open account and deposit funds to your forex broker. It’s time to do this. Depositing real money will set your mind in the right mood and you will be ready for the shark’s game.

2. Start a trial of the signal service. Yes, do the trial with real money and not with a demo account. You may play with small lots (so only few dollars will be risked on your balance per trade), but do it with real money. You need to see how your mind handles the signals when real funds are in the game. Most trials are short (one week), so you can’t rely too much on this test performance, but it’s still a good way to experience how the signals reflect your trading.

3. Pay for the signal service. If you felt the signal provider is giving good calls, even if your first week trial is not a success, it’s the time to pay the subscription and start the real fun. The fee paid to the signal provider may be one of the best investments you ever made.

Develop your strategy

This doesn’t mean that you should understand trading well (otherwise why would you pay for signals). Developing a strategy for signal trading is simple – it means just to set your risk levels. The best signal providers won’t send you alerts “close right now”, “close at 15 pips profit” etc.

For example in Millennium Traders we are given signals like “consider taking some profits on XXX/YYY”, but the chat room moderator keeps the position open. They usually have 3 targets and if the signal is good give you 3 suggestions to close or to keep waiting for higher profits. You should decide this yourself. Of course you can decide to follow exactly the moderator’s sells/buys, but this again means you have chosen such a strategy (Millennium Traders mods are quite aggressive. I usually close positions before them).

Question: Do you already have any experience with forex signal trading?

The last part is now available – How To Trade Forex By Signals, Part Three