When I started in the Forex markets, I had the chance to meet confirmed traders, included some full-time ones and with whom I trade now.
I remember my first steps on the forums, it is not easy to sort out and avoid the traps in the Forex jungle so here are 10 tips:
- Can we make money in the forex (and a lot of money)? Yes absolutely, this is the case 10% of traders, 80% of traders close their account in less than a year. Key Qualities: Patience & Discipline In fact, many strategies work on the Forex but the problem is this: The vast majority of people do not have the discipline to follow precisely their strategy and/or are not patient enough to wait for the right entry setup on the market and / or the right exit according to the rules of their strategy. Patience and discipline are constantly tested in the trading days (especially on the lower time frames) and therefore the mind plays a huge role.
- How much money do I need to start trading? Forget the “I’ll start with 200 euros/$,” you can start with 1000 euros/$ but you would rather start and train with a virtual account
- How much time do I need? Here you can face a problem: If you have less than an hour a day, you can trade only on the daily chart and therefore, a 15K USD account would be already a small one. If you have several hours a day, you can trade lower time frames but it takes time.
- Do not gamble money you need, you would not trade with a stress free mind and the mind is 90% of success in trading.
- You must have fun doing what you do, you must be convinced that the market is a friendly place.
- Trading successfully is simple but it is not easy! Let me explain: The strategies are simple (they do not have to be complicated) but sometimes it’s difficult to remain patient and disciplined, the left hemisphere of the brain (responsible for emotions), sometimes taking over
- Write down your strategy on paper and read it before each trading day
- Avoid overloading your charts with too many indicators because it will interfere with the analysis. The indicators explain the past, the price action explains the present.
- Do not try to copy others, find the method that suits your personality and lifestyle. There are some brokers that offer to follow and copy confirmed traders, it is suicide! These traders have their own strategy and place their orders according to it. They do not have the same amount of money than you in their account, the same working hours, etc … Similarly, the advice of experts in the newspapers are often obsolete once the newspapers released them! No-one can really predict how the market will behave as the Forex market includes millions of different actors, millions of minds, analysis and tens of millions of decisions. Trading is personal, learning to trade is learning to know yourself
- There is no money made easily. You are certainly overwhelmed by ads such as: “How I made 500 euros/$ in 20 minutes”, etc …Forget it! You can also loose 500 euros/$ in the same period of time. Make those amount of money in such little time requires experience and a good understanding of the market. Binary options, in particular, must be avoided if you have no experience. Remember: Success in Forex Trading requires investment in time and also money.
- Last Advice : Find a mentor (an experienced person in trading that can help you)