As a trader myself, I’ve been exactly where you are. I wish I could say that there’s a “paint by numbers” blueprint that I could just give you, or a tried and tested automated trading system that you could just plug in and profit, but in reality it’s not that simple at all. You are going to make mistakes along the way, lose some money and feel like quitting. It’s a completely normal part of the process that every trader has to go through before they start making progress towards their goals. That said, there are a few things that I’ve learned over the years about trading that I’d like to share with you, to help you to start making money in Forex a lot quicker than you otherwise would.
Before you commit any real money to trading a Forex account, you should learn the basics of technical analysis (TA). A lot of so called experts go around saying that technical analysis is dead, but at the end of the day TA is a study of historical prices and how they change over time, and if you don’t consider price then what else do you have to base your decision on? To me, technical analysis can be as simple or as complicated as you want it to be. You can just have pure price on your charts, you can plot support, resistance and trendlines if you want to get a bit more advanced, and obviously there are hundreds of different indicators ranging from the moving averages to Fibonacci levels that you can apply as well.
Why is this important?, well, how are you going to decide what position size to take, when to pull the trigger and what are the potential win/loss scenarios? . Even if you’re just going to follow someone’s recommendation, normally they will have done their own technical analysis, so you’ll be able to understand their reasoning behind calling a trade and know when things aren’t going as predicted so that you can get out with your money intact.
The winning attitude that you should adopt in your trading is that not losing money is more important than making a lot of money in Forex. That means that you keep your risks low at the start, and you apply correct money management to protect yourself from bad trading streaks. After all, you are only going to lose money at the start of your trading career, so it makes sense to keep those losses as small as possible while you learn.
As time goes by, and as you improve yourself in your trading, you will notice that your losses start getting smaller and less frequent, and your wins start getting bigger and more frequent. Once you have achieved consistency in your trading, then you are finally ready to start making money in Forex. Until then, keep working at the basics, which are technical analysis, money management and most importantly, your mindset.
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