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Forex-trading---instantly-increase-your-profits-with-the-80---20-rule By Stephen todd The 80 – 20 rule was not devised for Forex trading - however if you apply it in your trading, you'll instantly increase your profit potential. The rule is simple to understand and apply - and all Forex traders should use it.
So, what is the 80 – 20 rule, and why is it so powerful in terms of making Forex profits?
The Logic of the 80 – 20 Rule
In the nineteenth century, Vilfredo Pareto, an Italian philosopher, observed that a small section of the population held most of the money and power. He postulated that in most countries, 80% of the money and power was controlled by around 20% of the people. Therefore, 20% of the participants accounted for 80% of the results.
The 80 – 20 rule applies to many other areas of life - including Forex trading, and in simple terms, the key point to consider is this:
80% of your results will be generated by 20% of your efforts.
This also means that:
20% of your results will be generated by 80% of your efforts.
In Forex trading, it’s a fact that most traders make this critical error – they trade too much - and try to force results by working too hard.
Here’s what you need to do, to apply the 80 – 20 rule in Forex trading, and increase your results:
1. Cut out short term trading - like Forex day trading. In day trading, you trade frequently - but it simply doesn’t work. This is because all short-term volatility is random - and you can never get the odds in your favor.
2. Only trade significant technical patterns - such as critical breaks of support and resistance, with your Forex trading system.
3. Risk more per trade on the “good trades” - up to 20% is OK. Remember, risk goes with reward - and you need to take meaningful calculated risks, when the odds are in your favor.
4. Don’t diversify! Forex traders think this spreads risk, but all it does, is simply dilute profit.
In terms of your Forex trading
Forex - Canadian Dollar May Falter On Weakening Global Picture
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.forextv.com/forex-news-story/forex-canadian-dollar-may-falter-on-weakening-global-picture" style="font-size:1.2em">Forex - Canadian Dollar May Falter On Weakening Global Picture</a>
<br> <span style="color:#888888;">ForexTV.com</span> - <span style="white-space:nowrap">Jul 30, 2010 </span>
<div style="width:80%;">RISK DISCLAIMER: By using this web site you agree to its terms and conditions. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of ...</div>
</div>
Forex: USD/CAD tumbles to 1.0292, 3-day low
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.fxstreet.com/news/forex-news/article.aspx?storyid=d17c3a7a-e9b4-4400-9cae-1579864a1b97" style="font-size:1.2em">Forex: USD/CAD tumbles to 1.0292, 3-day low</a>
<br> <span style="color:#888888;">FXstreet.com The Forex Market</span> - <span style="white-space:nowrap">Jul 30, 2010 </span>
<div style="width:80%;">FXstreet.com (Córdoba) ? The Canadian Dollar erased losses and turned higher against Greenback as stocks recovered in Wall Street. USD/CAD jumped to 1.0375 (daily high) after the release of US and ...</div>
</div>
Forex spread betting: EUR CAD in focus
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.spread-betting.me/forex-spread-betting-00404.html" style="font-size:1.2em">Forex spread betting: EUR CAD in focus</a>
<br> <span style="color:#888888;">Spread Betting for Me</span> - <span style="white-space:nowrap">Jul 30, 2010 </span>
<div style="width:80%;">If you don't have the time to concentrate on placing your trades then you are doomed. A few rules to making your way to a successful spread betting strategy. We bring those looking at forex spread ...</div>
</div>
Daily Forex Update: EUR/CAD
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.actionforex.com/index.php?option=com_content&view=article&id=119009:daily-forex-update-eurcad&catid=191:daily-forex-technicals" style="font-size:1.2em">Daily Forex Update: EUR/CAD</a>
<br> <span style="color:#888888;">Action Forex</span> - <span style="white-space:nowrap">Jul 30, 2010 </span>
<div style="width:80%;">After a week of hard-fought gains and higher lows in the EUR/CAD, the Euro has weakened slightly against the Canadian Dollar and corrected lower intraday. After exhausting at the resistance of the ...</div>
</div>
Canadian Dollar Wipes Out Intraday Gain
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.forex-rateit.com/forex-news/canadian-dollar-wipes-out-intraday-gain.html" style="font-size:1.2em">Canadian Dollar Wipes Out Intraday Gain</a>
<br> <span style="color:#888888;">Forex Rate It!</span> - <span style="white-space:nowrap">Jul 29, 2010 </span>
<div style="width:80%;">After reaching an intraday high of 1.0302 against the US dollar, Canadian dollar moved back to the 1.0380 area. Canadian dollar lost its strength to wipe out most of its intraday gains. The pair ...</div>
</div>
Canadian Dollar Forecast to Break Below Narrow Range
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.dailyfx.com/forex/technical/ssi/usd-cad/2010-07-29-1526-Canadian_Dollar_Forecast_to_Break.html" style="font-size:1.2em">Canadian Dollar Forecast to Break Below Narrow Range</a>
<br> <span style="color:#888888;">Daily FX</span> - <span style="white-space:nowrap">Jul 29, 2010 </span>
<div style="width:80%;">USDCAD - The ratio of long to short positions in the USDCAD stands at 2.57 as nearly 72% of traders are long. Yesterday, the ratio was at 2.19 as 69% of open positions were long. In detail, long ...</div>
</div>
Drop in Crude Oil Weakens CAD
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.fxstreet.com/technical/analysis-reports/daily-currencies-report/2010-07-29.html" style="font-size:1.2em">Drop in Crude Oil Weakens CAD</a>
<br> <span style="color:#888888;">FXstreet.com The Forex Market</span> - <span style="white-space:nowrap">Jul 29, 2010 </span>
<div style="width:80%;">by UFXBank Research USD Dollar (USD) ? The Dollar was mixed against other major currencies in Forex Trading after worse than expected US data on durable goods orders that came at -0.6% vs. 0.6 ...</div>
</div>
Canadian Dollar (CAD) Technical Major Currencies (2010-07-30)
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://uk.ibtimes.com/articles/20100730/canadian-dollar-cad-technical-major-currencies-2010-07-30.htm" style="font-size:1.2em">Canadian Dollar (CAD) Technical Major Currencies (2010-07-30)</a>
<br> <span style="color:#888888;">IBTimes</span> - <span style="white-space:nowrap">Jul 29, 2010 </span>
<div style="width:80%;">The pair is moving within a very narrow range that has not changed the harmonic pattern expectations suggested yesterday; thus making us hold onto yesterday's expectations intact without any ...</div>
</div>
Westpac Exits Its Bet on the Canadian Dollar Rising Against Swiss Franc
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.bloomberg.com/news/2010-07-29/westpac-exits-its-bet-on-the-canadian-dollar-rising-against-swiss-franc.html" style="font-size:1.2em">Westpac Exits Its Bet on the Canadian Dollar Rising Against Swiss Franc</a>
<br> <span style="color:#888888;">Bloomberg</span> - <span style="white-space:nowrap">Jul 29, 2010 </span>
<div style="width:80%;">By Lukanyo Mnyanda - Thu Jul 29 13:45:29 UTC 2010 Westpac Banking Corp. exited a bet that the Canadian dollar would rally to its strongest level this month against the Swiss franc after the loonie ...</div>
<a href="http://www.businessweek.com/news/2010-07-29/canadian-dollar-rises-first-time-in-3-days-as-commodities-gain.html">Canadian Dollar Rises First Time in 3 Days as Commodities Gain</a> - <span style="color:#888888">BusinessWeek</span><br>
<a href="http://www.rttnews.com/Content/CanadianNews.aspx?Node=B1&Id=1377435">Canadian Dollar Advances Further Against Major Rivals</a> - <span style="color:#888888">RTT News</span><br>
<a href="http://www.dailyfx.com/forex/fundamental/forecast/weekly/cad/2010/07/30/TOF730cad.html" style="color:#009900">Daily FX</a>
</div>
| EXCHANGE RATE
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.dailynews.lk/2010/07/29/ExchangeRate.asp" style="font-size:1.2em">| EXCHANGE RATE</a>
<br> <span style="color:#888888;">Ceylon Daily News</span> - <span style="white-space:nowrap">Jul 28, 2010 </span>
<div style="width:80%;">Exchange Rates on 28.07.2010 (1) The average rates of the following currencies quoted by commercial banks in Colombo for Telegraphic Transfers (TT) at 9.30 am are as follow: Currency Buying Rate ...</div>
</div>
strategy: Focusing on the above will make you more money – but you’ll also reduce the effort you put in.
Shift your emphasis to long term trading - and only trade the best signals. By doing this, your workload - and the amount of time you need to spend on your Forex analysis will be reduced.
If you apply the 80 – 20 rule to your Forex trading in the above way, you’ll cut the effort you put in. You’ll also increase the profits you make - and that’s what all Forex traders want!
Cutting the Effort You Put In and Getting Bigger Rewards
Many people think that the more effort you put in, the better the results you obtain. This is true in many areas of life - but not Forex trading! Here you are paid for being right with your Forex trading signals - that’s all.
Also, don’t fall for the myth that the more you trade, the better your chance is of having Forex trading success. This is simply not true - because the big trades, with the best ratio of risk to reward don’t come around that often.
Incorporate the 80 - 20 rule in your Forex trading strategy, and watch your profits soar. Article Source: http://www.upublish.info About the Author: Stephen todd NEW! 5 5 X Critical Trader PDF's & Much More Claim your FREE PDF's and demo account and learn Forex Trading and also get: Breaking financial news, tight pip spreads, guaranteed stops $100.00 minimum investment and 400:1 leverage at http://www.freeforexguidesonline.com Ready to copy Article in either text or html format:
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Forex - Canadian Dollar May Falter On Weakening Global Picture
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.forextv.com/forex-news-story/forex-canadian-dollar-may-falter-on-weakening-global-picture" style="font-size:1.2em">Forex - Canadian Dollar May Falter On Weakening Global Picture</a>
<br> <span style="color:#888888;">ForexTV.com</span> - <span style="white-space:nowrap">Jul 30, 2010 </span>
<div style="width:80%;">RISK DISCLAIMER: By using this web site you agree to its terms and conditions. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of ...</div>
</div>
Forex: USD/CAD tumbles to 1.0292, 3-day low
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.fxstreet.com/news/forex-news/article.aspx?storyid=d17c3a7a-e9b4-4400-9cae-1579864a1b97" style="font-size:1.2em">Forex: USD/CAD tumbles to 1.0292, 3-day low</a>
<br> <span style="color:#888888;">FXstreet.com The Forex Market</span> - <span style="white-space:nowrap">Jul 30, 2010 </span>
<div style="width:80%;">FXstreet.com (Córdoba) ? The Canadian Dollar erased losses and turned higher against Greenback as stocks recovered in Wall Street. USD/CAD jumped to 1.0375 (daily high) after the release of US and ...</div>
</div>
Forex spread betting: EUR CAD in focus
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.spread-betting.me/forex-spread-betting-00404.html" style="font-size:1.2em">Forex spread betting: EUR CAD in focus</a>
<br> <span style="color:#888888;">Spread Betting for Me</span> - <span style="white-space:nowrap">Jul 30, 2010 </span>
<div style="width:80%;">If you don't have the time to concentrate on placing your trades then you are doomed. A few rules to making your way to a successful spread betting strategy. We bring those looking at forex spread ...</div>
</div>
Daily Forex Update: EUR/CAD
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.actionforex.com/index.php?option=com_content&view=article&id=119009:daily-forex-update-eurcad&catid=191:daily-forex-technicals" style="font-size:1.2em">Daily Forex Update: EUR/CAD</a>
<br> <span style="color:#888888;">Action Forex</span> - <span style="white-space:nowrap">Jul 30, 2010 </span>
<div style="width:80%;">After a week of hard-fought gains and higher lows in the EUR/CAD, the Euro has weakened slightly against the Canadian Dollar and corrected lower intraday. After exhausting at the resistance of the ...</div>
</div>
Canadian Dollar Wipes Out Intraday Gain
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.forex-rateit.com/forex-news/canadian-dollar-wipes-out-intraday-gain.html" style="font-size:1.2em">Canadian Dollar Wipes Out Intraday Gain</a>
<br> <span style="color:#888888;">Forex Rate It!</span> - <span style="white-space:nowrap">Jul 29, 2010 </span>
<div style="width:80%;">After reaching an intraday high of 1.0302 against the US dollar, Canadian dollar moved back to the 1.0380 area. Canadian dollar lost its strength to wipe out most of its intraday gains. The pair ...</div>
</div>
Canadian Dollar Forecast to Break Below Narrow Range
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.dailyfx.com/forex/technical/ssi/usd-cad/2010-07-29-1526-Canadian_Dollar_Forecast_to_Break.html" style="font-size:1.2em">Canadian Dollar Forecast to Break Below Narrow Range</a>
<br> <span style="color:#888888;">Daily FX</span> - <span style="white-space:nowrap">Jul 29, 2010 </span>
<div style="width:80%;">USDCAD - The ratio of long to short positions in the USDCAD stands at 2.57 as nearly 72% of traders are long. Yesterday, the ratio was at 2.19 as 69% of open positions were long. In detail, long ...</div>
</div>
Drop in Crude Oil Weakens CAD
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.fxstreet.com/technical/analysis-reports/daily-currencies-report/2010-07-29.html" style="font-size:1.2em">Drop in Crude Oil Weakens CAD</a>
<br> <span style="color:#888888;">FXstreet.com The Forex Market</span> - <span style="white-space:nowrap">Jul 29, 2010 </span>
<div style="width:80%;">by UFXBank Research USD Dollar (USD) ? The Dollar was mixed against other major currencies in Forex Trading after worse than expected US data on durable goods orders that came at -0.6% vs. 0.6 ...</div>
</div>
Canadian Dollar (CAD) Technical Major Currencies (2010-07-30)
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://uk.ibtimes.com/articles/20100730/canadian-dollar-cad-technical-major-currencies-2010-07-30.htm" style="font-size:1.2em">Canadian Dollar (CAD) Technical Major Currencies (2010-07-30)</a>
<br> <span style="color:#888888;">IBTimes</span> - <span style="white-space:nowrap">Jul 29, 2010 </span>
<div style="width:80%;">The pair is moving within a very narrow range that has not changed the harmonic pattern expectations suggested yesterday; thus making us hold onto yesterday's expectations intact without any ...</div>
</div>
Westpac Exits Its Bet on the Canadian Dollar Rising Against Swiss Franc
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.bloomberg.com/news/2010-07-29/westpac-exits-its-bet-on-the-canadian-dollar-rising-against-swiss-franc.html" style="font-size:1.2em">Westpac Exits Its Bet on the Canadian Dollar Rising Against Swiss Franc</a>
<br> <span style="color:#888888;">Bloomberg</span> - <span style="white-space:nowrap">Jul 29, 2010 </span>
<div style="width:80%;">By Lukanyo Mnyanda - Thu Jul 29 13:45:29 UTC 2010 Westpac Banking Corp. exited a bet that the Canadian dollar would rally to its strongest level this month against the Swiss franc after the loonie ...</div>
<a href="http://www.businessweek.com/news/2010-07-29/canadian-dollar-rises-first-time-in-3-days-as-commodities-gain.html">Canadian Dollar Rises First Time in 3 Days as Commodities Gain</a> - <span style="color:#888888">BusinessWeek</span><br>
<a href="http://www.rttnews.com/Content/CanadianNews.aspx?Node=B1&Id=1377435">Canadian Dollar Advances Further Against Major Rivals</a> - <span style="color:#888888">RTT News</span><br>
<a href="http://www.dailyfx.com/forex/fundamental/forecast/weekly/cad/2010/07/30/TOF730cad.html" style="color:#009900">Daily FX</a>
</div>
| EXCHANGE RATE
<div style="padding:0px; margin-bottom:1.5em;">
<a href="http://www.dailynews.lk/2010/07/29/ExchangeRate.asp" style="font-size:1.2em">| EXCHANGE RATE</a>
<br> <span style="color:#888888;">Ceylon Daily News</span> - <span style="white-space:nowrap">Jul 28, 2010 </span>
<div style="width:80%;">Exchange Rates on 28.07.2010 (1) The average rates of the following currencies quoted by commercial banks in Colombo for Telegraphic Transfers (TT) at 9.30 am are as follow: Currency Buying Rate ...</div>
</div>
Simultaneously buying one currency and selling another.
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