FOREX TRADING FOR BEGINNERS

In this Article we’ll be looking at tips for Forex Trading Beginners.

Remember you can always use the demo account to get a better understanding of the market.

TRADING FOOD CHAIN

Knowing the way the industry is mapped out important, because the combination of all participants makes the market you trade in, think of it like getting balanced diet.

LONG TERM OR SHORT TERM TRADING

Initially while trading as a beginner your trade should be about preserving your capital and not trying to grow it.

Minimizing risk is the main objective as a beginner. One way to achieve this is to use a long term trading stance.

What ignorant forex trading beginners fail to know s the some successful traders try to make a return on their investment based on Long term trends. They keep their orders opened for weeks, months and sometimes years. This way, forex work more as an investment and less as lottery.

To trade for long term it requires patience and calmness and modesty in trading volume.

As a payoff it also takes just few hours spent looking at your screen and it’s less stressful. Mathematics is very important while trading forex online, graciously there are ways to calculate what balance, leverage and trading volume you need per instrument to always make sure you take less risk.  

DO NOT OVERCOMPLICATE THINGS WHILE TRADING AS A BEGINNER

Don’t have surplus indicators on your charts and your strategies with handles or switches.

To discover how well a strategy performs on average in several markets, you need to make necessary research and back-testing. Allowing things stay simple is most times a big challenge for beginners, especially if we take into considerations all the supporting tools you can apply to your charts.

 CONSIDER BUYING A SOFTWARE

Being a beginner or a professional in forex trading you need to reconsider buying a software, When brokers compete with each other it means forex trading software’s are available for free.

KNOW THE TECHNICAL AND FUNDAMENTAL ANALYSIS

Analysis is one hundred percent vital to trading. For both long and short term trading Charts are very helpful. You should be looking out for daily, weekly and monthly charts.

ALL FOREX TRADING GUIDES FOR BEGINNERS OF TECHNICAL ANALYSIS WILL TELL YOU THAT YOUR MAIN TOOLS ARE:

1.    Trend lines

2.    Support and resistance lines

3.    Indicators based on the above

Meanwhile, understanding fundamental analysis allows traders to acquire an understanding of how one country’s news and financial policies can affect the FOREX SYSTEM.

TRADING ACCOUNTS IS MORE THAN JUST MINIMUM DEPOSIT

Minimum Deposit and tight spreads should be the last things to consider when opening a forex trading account. Instead of that pay attention to instrument portfolios, execution models and the leverage offered.

The best trading platforms for forex can be determined by the broker, as the best broker also depends on the trading system.

Be careful of dealing Desk accounts unless you’re interested in the conditions offered by them.

Their features include momentous execution, instant execution and comparatively low minimum deposits. This means you are trading with the broker and not through it.

Be careful in volatile Markets

Volatility keeps every trading activity moving. However, if you’re not cautious, it can ruin it. The market goes sideways when volatile and it makes spread grow also your orders slips.

Always put volatility analysis into your trading strategy. Starting off as a beginner in trading you need to know that anything can happen in the market and it can completely contradict your strategy.

THE TREND IS YOUR FRIEND

In case you are a beginner or a professional, it is best to trade with what you see and not what you think your thoughts might put you in great risk.

For instance you may think Pounds is overvalued and has been overvalued for too long. Normally you’ll want to go short and you might be right eventually.

But if the price is going upward, it won’t matter what you think or what anybody thinks. The price is moving up? You have to follow the trend.

                   THERE ARE HUNDREDS OF AVAILABLE MARKETS

Learning about forex trade as a beginner, other beginners concentrate on major currency pairs because of their day to day volatility and tight spreads.

The number of markets you can check for opportunities depends on you, but don’t limit yourself to one instrument or one market. When you are limited to one market it causes overtrading, so broaden your investment.

DON’T FOCUS ON ONLY OPENING THE TRADE THE CLOSING TOO IS VITAL

A normal forex trader who is  just a beginner focuses more on opening a trade, but keep in mind the closing point is also important.

If your strategy does not want to consider closing a deal then it’s in high probability that the deal isn’t going to end well, and you are likely to face heavy Loss.

MAKE SURE YOU ARE LEGALLY PROTECTED

Government has ensured regulators of brokerage firms to give caution to forex trading beginners worldwide.

When seeking for conditions that will secure your investment or Trade, these points should be taken to consideration:

1.    Separation of Client funds: Insure your money is not misused by broker for anything except trading, which makes it always available for withdrawal when you request for it.

2.    Compensation Scheme: This is the amount of funds that will be given to you as compensation when the broker or bank seems to be going bankrupt.

3.    Efficient enquiry for customers and complaints procedure: This ensures that if a complaint or enquiry is filed by a trader and it isn’t rectified within hours, it will be immediately moved to the customer support desk and compliance department.

Always make sure your investment or trading is protected.

TEST ON A DEMO ACCOUNT OR WITH A SOFTWARE

Every broker gives a demo account to its traders, beginners or not. Make sure to test every new strategy there first. Continue until you are positive and conclusive about what you are testing.

When you are done testing Open a live account and use the strategy you’ve tested in the smallest volume trades available. Remember to always trade with your demo account as if it was a real account.

WRITE DOWN YOUR PLANS

As a trader you should know how to plan, monitor and organize your trade. What other way is great doing that except writing it down.

Have a trading Journal and make sure to first of all write points for further research, Reasons to open or close a trade and all your achievements or mistakes so you won’t have to make those mistakes again.

ALWAYS DO YOUR RESEARCH

It is said that the more you know the less you are at risk; also there is no limit to what you can know or risk. Endless knowledge and information is available free of charge on the internet.

Always watch

1.    Educational articles and tutorials

2.    Trading seminars for beginners and pros in forex

3.    Forex trading for beginners videos.

Forex trading webinars and so on.

TRADE CALM

Trading is exciting but also stressful. You’ll face a lot of challenges and setbacks on your journey to the top. If you can’t control your emotions you are likely to make wrong decisions like opening a trade too early or too late.

The reason why some beginners in forex trading face real stress is because they end up in loss no matter what, don’t worry it’s just the way the market is.

That’s why it’s good to have a trading Journal so you can write your mistakes and also right your wrongs.

FUNDING YOUR TRADING

The only kind of money that is good to trade is the one you are willing to lose, that is you won’t feel real bad that you risked the money and the money is not that useful to you.

Always put money that won’t damage you physically or mentally.

Note: every profitable trader profits in his own way, and loser also loses in their own way.

Remember to always use every opportunity available to learn, because learning is an unending process.