Forex trading is far from being an easy thing. Without a solid market knowledge and a well-thought-out strategy, you will hardly be able to make money. What is more, the local financial market specs pose some difficulties for inexperienced traders. So what is special about trading Forex in the Philippines? What should you be aware of before making your first deals?
Why Is Market Liquidity in the Philippines Important?
Imagine just that there are practically no changes in the market. At this point, you might have some questions: what can a trader do; what strategies are suitable; how to make money on a market with low liquidity. There is an answer, and it is quite simple: you need to adapt your strategies and look for opportunities in situations that seem to have no way out. For example, using Alpari as a trading platform can be a solution since it gives you access to a multitude of instruments so that you could monitor the market.
Specs of Trading in a “Sleeping” Market
If you want to make money or avoid losses of finance, be ready to adjust your trading approach to the current market state where you are operating on. Thus, trading on a low-liquidity market is directly related to the Inplay strategy, but it is more highly specialized. The approach is more focused not on intraday levels but on trends that stretch from previous days and are noticeable on more global timeframes.
The essence of trading in an illiquid market is the existence of signals that are impossible to hide. The crowd is not able to greatly impact the market because it is always a few steps behind large players. Any mathematical change in dynamics may indicate that a large institutional is present in the stack. For a trader, this is a clear signal to enter the stock.
The period when liquidity falls on the market is one of the most unstable for a day trader. After all, the ideal situation for trading is when news related to the company’s activity is regularly released or when a crisis occurs either locally or globally. All these make the stock change. Thus, the strategy of trading in a “sleeping” market is to select stocks that show dynamics. With a relevant stock and strategy, a trader will have stable earnings regardless of the state of the market.
Key Strategy Points
To keep abreast of all the intricacies of trading in the low-liquid market and stick to them, we recommend that you stay tuned to the following:
- trading constants and variables;
- the role of time frames and their detailed analysis;
- search for large players and the differences of the crowd from professionals;
- basics of technical analysis;
- risk management relative to market trends.
Only in this way, trading can become a profitable business of yours! By the way, finding a good broker for an exchange can also increase your success rates.