Professionals cannot do without their tools. A carpenter can only make his products when his tools are sharp, a soccer player can only practice if his leather ball is of good quality, and a Forex trader only makes big profits using the best tools such as an indispensable Forex calculator, calendar and having a trading plan. But what makes a proper Forex trading tool? How can brokers know which one is right for them?
The key to a good Forex tool is to work well with other tools. Tools must work as a team. That’s why we’ve found the three must-have forex tools for the successful Forex trader, which not only work separately but combine to form an unstoppable team. Nowadays, many tools for beginners can be downloaded for free. It doesn’t matter which technique you use, algorithmic trading or otherwise.
1: Prepare your trading journal
Athletes spend time reviewing their performance video after games. Or how crypto miners calculate the return from mining cryptocurrency like bitcoin. So you should spend time analyzing the deals you have made. You do this by noting each currency pair (real or virtual currencies) that you have identified and each trade that you have made. There are journals online that you can download, but we’ve found that nothing beats a good quality pen and paper.
Handwritten note-taking has been proven to help you remember things better than hearing or seeing them. Research shows that handwritten notes are even better than typing. If you want a digital version of your journal, writing in Excel (or a free alternative to Excel) or in a Google Sheet would work, but the handwriting is still king.
Therefore, we recommend that you find a notebook and a pen and create a table for your exercises. Have sections devoted to the currency pair (dollar, yen, euro, bitcoin etc …) that you are trading, at the time of day, at your point of fall, at stopping your losses, at exiting markets and your bottom line. Write down every deal you make. After a while, you will be able to see your trading trends. Use these trends to hone your skills.
2: Reliable Charting Software is a Must
Other than your broker, this is the most important tool you can have. Good, reliable charting software is a tool that shows you the in-depth aspects of trading the forex market. These in-depth aspects are displayed by the indicators in your software. Indicators are advanced statistics and overlays that analyze different aspects of trading to give you an idea of the future of the market.
3: An Economic Calendar in a volatile market is your big friend
Forex is a very volatile market, which is what makes it great. However, there are times when the market is more volatile than others. The reasons are fundamental announcements. Fundamental announcements (or Fundys) are big events that shed light on a country’s economic situation. You can use the economic calendar to be informed and trade according to market conditions.