Before we take you through our step-by-step guide, a good place to access information about trading with Plus500 is the FAQ’s page on our website. Here you can find answers to many questions which could help you get acquainted with Plus500 before you start on your trading journey with us. There is information on opening your account, making a deposit, financial instruments, trading and more.
A Step-By-Step Guide
Deciding on the right market to trade is a first step in building an effective trading plan, and when weighing up your options, it would be best to start off with a market that you have some prior understanding of or that you are familiar with from past experience.
Knowing how and why markets move and the potential events and economic factors that influence them is extremely valuable in helping you devise a strategy that identifies relevant, and potentially profitable, trading opportunities.
Deciding to Buy or Sell
When trading CFDs with Plus500 you can choose which markets are right for your trading strategy from the wide range of available shares, forex pairs, soft and hard commodities, options* and stock market indices. As with any form of trading, research and analysis is critical when it comes to choosing the right market to trade and the best time to open a position. You must ensure that you have a deep understanding of market trends, traders’ sentiments* and volatility before you decide to trade in a live environment. Moreover, you need to identify the issues and events which could drive price movement in the market and determine how this may impact your trading decisions.
*Subject to operator.
Reviewing Asset Details
Before entering the market, decide on the desired number of contracts (i.e., trade amount) and how this fits your trading budget. Your profit or loss will either rise or fall for each pip the market moves in either direction. To find details of the size or unit amount for each CFD instrument, click on the instrument’s Info icon.
The Info section provides you with details of the leverage applicable to that instrument, its unit size, initial and maintenance margin requirements, as well as other important information. You should familiarize yourself with the information contained in this window.
Using Advanced Charting Capabilities
Conducting market research and analysis can help you get a feel for the current sentiment within the market you wish to trade. Plus500’s advanced charting tools will give you the ability to see historical price activity and apply a full range of technical analysis techniques.
There are various chart styles available to suit your preferences. You can choose anything from a Line, Baseline, Mountain, Candle, Hollow Candle, Bar, Coloured Bar, Heikin-Ashi, Renko, Kagi, Line Break chart and more. This extensive chart selection really allows you to analyze market movements exactly to your needs.
There are many indicators which you can add to your charts to help you technically analyze market movements in detail. For example, Bollinger Bands is an indicator tool with two standard deviations (positive and negative) which moves away from an average of an underlying instruments price, and can be changed to suit your preferences. Other common indicators include MACD, RSI, Volume Underlay, Moving Average, Moving Average Deviation and many more.
Plus500’s advanced Multiple Charts tool allows you to compare different instruments by viewing their charts side by side. This enables you to perform high-quality technical analysis according to your preference. You can view up to 9 charts at the same time in Full Screen, while controlling the resolution, chart type and more for each chart individually.
Once you’ve set your preferences for one chart, you can easily apply it to the rest of the charts by clicking “Apply to all charts”. After you set your chart preferences, you can save your chart layouts by clicking the “Save” icon and reload it anytime.
Future Chart Space
Use your analysis tools in the future space added to our charts. It is simple to use, just scroll right to see the empty future space. You can always use the back button to return to the present. Also, you can add indicators with future projections to help you analyze future price movements.
Utilize the drawing tools to add your predictions to the empty chart space. This will help you to better visualize your next steps. Then, simply click on the brush button and pick the drawing tool you would like to use.
Setting up a Trade
Once you have identified a trading opportunity, you should act decisively and follow the rationale behind your trading plan. Ensure that you have sufficient risk management controls in place and that you have a clear exit strategy in mind. Your trading strategy should give you a firm idea of the right time to close an open position, e.g. when your target profit has been reached, or when a stop loss level has been triggered. A stop loss is a market order used to close a losing position once it has reached a certain level.
Exiting the market at the right time can be the difference between a losing trade and a profitable one.
Plus500’s trading platform is understandable, with clear options in the trade window, which allow you to select the size of the CFD contract, choose a buy or sell position and to attach and define risk management tools, such as Stop Loss and other limit orders. There are many strategies that you can use to determine the price you wish to enter the market. Using the Plus500 trade window you can select to enter a market order or place a future order for the trade to be executed at a specific price point. If the price is reached, your order will be executed automatically for you. You can find this under the Advanced section in the order window.
Exit or Target
When you place a trade or a future order with Plus500, you can also set an order to close your position when a certain price level is reached. Once the predetermined price level is reached, your trade will be closed at the expected profit or loss.
A Stop Loss is a very important risk management tool and a way to protect your account from unexpected and larger than anticipated losses. The Plus500 Platform offers you several choices. The first option is to click on the “close at loss” box and set a price level at which to close your trade if the market moves against you. Taking care when setting this level is crucial. If the market moves against you, your position will be closed as close as possible to the level set in your Stop Loss order. Please note that you can change this level as many times as you need and there is no charge for using this feature.
For some instruments, you also have the option to select a Guaranteed Stop Order. This option will protect your position from slippage in a widely swinging market where liquidity could be limited. The charge for using this feature is a widened spread.
The last option is called a Trailing Stop Loss. A trailing stop loss moves up and down as the price of the instrument moves. The trailing stop loss is set at a certain number of pips from the price at which the order was executed. This feature is free of charge, but it is not guaranteed that your position will close at the exact price level you specify.