Determining Profit Targets in Forex Trading

"Never Be Satisfied With A Thing!" Maybe you've heard the teaching, which means never be satisfied with something you've accomplished today. In setting targets for the next time, if you can achieve even better than today. As we know, in the world of trading the opportunity to achieve the maximum profit is wide open. Even if you can, in one day you can make a profit of up to 100% more than the initial capital. Of course, this attracts traders in achieving large profits.

However, you also need to set a target in seeking profit and apply a consistent trading strategy so that the profit target can actually be achieved. In forex trading, there is a general term "the bigger the profit target, the greater the mental pressure to get it". But behind the profit target and mental pressure, at least there is a big target that makes you more excited. But sometimes the problem is, do we already have the proper ability to achieve that big profit target?

Determining the Profit Target Size So what is the profit target range that must be determined? There may be traders who set a profit target of around 50 USD or 70 USD in a day. Whatever it is, it's all legal. What needs to be reviewed is how much capital you have to be able to get the profit you are targeting?

If in a business, usually, the profit is around 10 percent – 30 percent per month of the total capital. Well, if you really take trading as a serious thing, then it's only natural that with a capital of 100 USD you are targeting a profit of 10-40 percent per month. Example: 40 percent per month, meaning that with a trading time of 20 days in 1 month, if you divide it evenly, you can achieve this profit target of 2 percent per day.

Read: Psikology Trading forex

So if you have a capital of 200 USD, the profit target can be 4 percent per day. But keep in mind, that the theory above is just a simple explanation so you can easily digest this concept. Because in reality, the target profit of 4 percent per day is a relatively small number.

The key, if you are serious about entering the world of trading, then prepare serious capital too! In determining profit targets, don't forget these important things:

Serious capital means preparing or at least separating trading capital from daily necessities. Trade money that is specially prepared for trading. Because there are times when you experience losses while trading.
If you already take this trading seriously, prepare capital carefully. So if your profit target is fairly reasonable, the results can be enough to finance your life. Whatever profit target you set, rest assured to be able to achieve it. Don't forget to limit the desire to get more profit than the target if there are no supporting signals.
Don't target too big a profit target. Because when your transaction is losing money, you will be further away from the specified profit target, and maybe even your mentality can be shaken.

Source Translated by: Seputar Forex