4 Tips on Getting a Level 2 Forex Funded Account
Every prop trader dreams of rising through about climbing the ladder. Learn and use our top 4 techniques for becoming a level-2 funded trader as soon as possible.
Tip #1: Plan, plan and plan
First and foremost, we require a strategy. Make a plan for how you will trade Forex. When it comes to looking for Forex trading setups, what will you look for in the market and how will you maintain your watchlist?
It all comes down to your plan and how well you can stick to it over a large sample of trades to determine if you will succeed as a funded Forex trader. In today’s market circumstances, being a profitable Forex trader is challenging, but having a well-structured plan and an investor will increase your chances of success.
It’s a good idea to brainstorm winning trading strategies on paper or in a folder on your computer. This will serve as your trading bible and a resource for learning how to trade. Revisit it on a regular basis and trade within the parameters of your strategy and pre-trade notes.
When it comes to maintaining your Forex funded account, having a method in place may help you prevent misunderstanding and overtrading. So there are no surprises, you’ll already know what to do and when to do it.
Once you’ve figured out your trading strategy, get to work. Maintain a regular routine in which you are comfortable and follow your success recipe. As you progress through the stages and assume greater responsibility, your strategy should be amended and updated on a regular basis to help you become a better Forex trader.
Tip #2: Frequency trading
As a Forex trader, you should categorize the various types of trades you are prepared to make and have a set percentage frequency for when you would enter each position. A trade setup with five target confluences, for example, will have a greater percentage spot than a setup with two confluences.
As a result, those five confluences may lead you to trade them 80% of the time you see them, and leave them 20% of the time. There are numerous strategies to strike a balance between your trading frequency and the trades you choose to enter.
Because you must consider your maximum drawdown, you must trade with minimal variance and limit the range of trades you open, especially if you’re just starting off with your trading account or if you’re in a drawdown. It is difficult to build long-term habits, because inherently we all want to win as quickly as possible. Maintaining a calm demeanour and trusting the process will result in a less stressful experience with a higher chance of success.
Tip #3: Break down targets into steps
A 10% success rate for a low-risk program is your target. So, by dividing that target into small steps, you can map out which trades you will execute. We have seen that several Forex traders will begin trading without any apparent guidance. When you combine this naivety with a lack of patience, you will find yourself chasing a goal too quickly, which will deplete your skill and force you to rely on luck.
As you progress through the ranks and levels, you will realize how important it is to establish that initial buffer, which provides you some breathing room. Increase the amount of capital away from the drawdown limit by generating a couple of percentages on your Forex funded account. As your equity increases, you will be able to trade with a larger sample size of trades, which will be increasingly dependent on your trading expertise over a longer period of time.
We have set our standard account capital increment milestones, but establishing your own milestones along the route is an excellent approach to break down the procedure and make it more manageable. We can recognise several trends in the variations in traders’ Forex funded accounts at various stages, such as how beneficial it is to construct a large number of modest profits rather than striving for a single home run trade.
Tip #4: Be strict
Maintain self-control and self-discipline. Sticking to a sound trading plan allows you to maintain control over your trades and establish a winning performance. All of the hard effort that goes into getting to level 2 boils down to meticulous planning. Know when to trade, and know when to sit on your hands.
Keep in mind that not every day must be a trading day. Locate your setups precisely and act on the high-probability trades that satisfy your criteria. If a trade doesn’t meet your requirements, don’t try to force it. You, not the market, are in charge of your account.
When you become strict with yourself, the Forex market will eventually reward you for all of your hard work and efforts. If you think of your Forex trades as bricks and continue to lay them in accordance with the plan, the overall structure will endure and you will be able to create something substantial.
The same may be said about your Forex trading. Be strict and stick to your own set of rules. You are your own boss.