The parabolic stop and reverse (parabolic SAR) indicator was developed to help traders locate buy and sell signals for current trends and determine when to enter and exit trades based on an asset’s momentum. It was created by J. Welles Wilder Jr., a prolific mechanical-engineer-turned-analyst who pioneered a variety of the technical analysis tools that financial traders still rely on today. His other feats include the relative strength index (RSI), average directional index (ADX), and average true range (ATR).

Forex traders should keep an eye out for quite a few things if they want to limit the risks associated with active trading. We’ve all seen it; many traders will follow fads instead of paying attention to the proper management of their money, and as a result, they will lose money unnecessarily. 

Two of the main reasons why forex traders lose money are stop-losses that aren’t used properly and unnecessarily large trading positions that are held far too long. Improperly used stop-losses are especially troublesome for novice traders, who don’t have the ability to plan long-term strategies around them.

If you’re looking to become a better, more knowledgeable trader, then read on to learn about the risk management strategies every forex trader should know.

The forex market sees a wide range of trading strategies used on a daily basis. Each one of them has its own pros and cons, although some strategies have a better track record than others when it comes to delivering results.

In forex trading, there’s ample logic behind the rhyme “the trend is your friend.” Trading in the direction of a strong trend both minimizes your risk and increases your potential profit.

As forex traders seek out stable investments that can hedge against inflation, market instability, and other geopolitical factors affecting currency prices, gold has grown in popularity over the past few years. Traders can use gold as a way to hedge against other investments, or as a safe haven that provides consistency over time and is more resistant to dramatic swings in valuation than many other currencies are.

If you’re serious about forex trading, you need to understand how charts and chart analysis tools can help you identify trades that maximize your potential earnings while minimizing risk. 

Most forex traders want to stay active throughout the year, even as market conditions change. Whether you’re facing a bull market or a bear market, forex trading opportunities are out there for individuals who are willing to do the research and adapt their strategies.

The key to trading in any market is understanding the factors affecting price movements. Although uncertainty in market conditions is risky territory for any trader, volatility is a profit opportunity if you have the right tools at your disposal.

Here’s a look at some basic steps you can take to adjust your trading strategy based on changing market conditions.

Forex indicators are useful in a variety of ways. They operate as tools that are embedded in trading platforms and connected throughout in order to offer traders a different—and often more concise—perspective on the market. They can offer long- or short-term forecasts, a view into the current state of a currency pair, or a look back at historical data. There are actually quite a few different forex indicators that are of use, several of which are detailed below.