Ii I have to admit I have not yet figured out how to make money trading currency, I have been trading for about a month and have placed too many trades to admit. I have broken even within one dollar to date. One little victory.
What I have figured out is how not to lose money. I hope that is half the battle and eventually I will figure out a winning way to trade. In the meantime, maybe this will help:
Account balance x percentage of risk (1-3% depending on whom you listen to) divided by stop loss number of pips (a function of the volatility inherent in the trade, every trade is different, you decide) divided by dollar change per pip (in a micro account it would usually be .10). Then round down to figure your lot size.
So, for me: $320.00 x 3% = $9.60 (maximum I am willing to risk). $9.60 / 30 pips = 32 cents a pip maximum risk / 10 cents a pip change per 1K lot = 3.2 lots, rounded down = 3 lots.
Set the stop and you will minimize your risk to less than 3 percent.
If you figure a winning trade system, let me know. At least I broke even and had fun.
Still eating macaroni & cheese but looking forward to steak.