Here are 20 forex trading tips. Hope You enjoy…
1. Know Yourself
Don’t go into forex trading with unrealistic expectation…you cannot make $50,000 a month on a $1000 trading
account. It’s not going to happen.
Know yourself…are you a cat pretending to be a lion? What does this mean? It means you may have a $1,000 forex trading account and you trade your account like you have a $1,000,000 trading account.
If you are a person that don’t like risks, then stay off the forex market. If you are having a financial difficulty and trying to make money off the forex market, then there’s a greater risk of losing your money as well because of your situation.
You really should ask yourself why you are getting into forex trading and what are you trying to achieve.
2. Stick To The Plan
Successful forex trading happens when traders stick to plans. The most important of them all is sticking to the trading plans which includes risk management.
3. Choose Your Forex Broker Carefully
The only 2 countries I will be really comfortable in opening forex trading accounts in are:
- United Kingdom
You want your money safe and easily accessible and these two countries have really strong regulations as well as policing of these regulations.
I’ve read horror stories online about traders opening live forex accounts in countries where the regulations are not so tough and when they made profits and want to withdraw it but couldn’t. These things happen. Its your choice which country you want to open your forex account. But I told you my best two countries.
So you really need to sit down and choose your forex broker carefully.
4. Pick your account type, and leverage ratio in accordance with your needs and expectations.
They say leverage is double edge sword. So you can make a lot of money and also lose your trading account.
Understand and study what forex leverage means and learn how you can use to your advantage to make money
The power of leverage in forex is the biggest advantage any Tom Dick and Harry trader can use to make a lot of money. Ignorance of forex leverage always turns disastrous.
5. Begin with small sums, increase the size of your account through organic gains, not by greater deposits.
Don’t start looking for forex holy grail or forex robots or “secret” trading systems. You will come across many of them, like this:
Don’t try to get rich overnight…start with a small trading account and build it up little by little. Know that there will times when you will lose. That’s part of the process of forex trading.
6. Focus on a single currency pair, expand as you better your skills.
If you are just starting forex, then focus on trading one currency pair only. As you get better, you can start trading the other currency pairs as well.
The benefit of this approach is that you only have one focus and you are not being diverted to checking trading setups on other currency pairs.
7. Trade What You Understand
Only trade what you know or understand. If you don’t know something, don’t do it until you are sure. For example, don’t trade news if you’ve never traded news before but you read somewhere online that says that currency news trading can be lucrative so you get into it thinking you will succeed.
8. Never Add To A Losing Position
This is a complete no-no. You never add onto a losing position. A losing position simply means that the market does not agree with your decision so you should respect that.
9. Restrain Your Emotions
The biggest hurdle in forex trading will be learning to control your emotions. Believe me, when your real money is on the line…when you see those floating profits going up and down or when you see your paper loss starting to get huge, your emotions will kick in forcing you do do things that you said to yourself that you would never do!
Forex trading success has a lot to do with managing emotions than can ruin your trading.If you learn to manage your emotions, you will do well in forex.
10. Take Notes So That You Can Study Your Trading Successes and Failures
How can you learn and improve yourself if you don’t know what trading mistakes you made in the past? That’s why always takes notes of the reasons why you entered a trade, take screenshots of trade setups that you took. So that you can study them later. All these will only make you a better forex trader.
12. Do Not Rely On Forex Robots And Other Indicators and Systems That Promise You The ATM
You know these things called forex robots or forex expert advisors…some of them promise your the holy grail….sleep while your forex robot makes money on autopilot. Really?
Take all this marketing with a grain of salt and pepper…
I know, forex robots have their place in the forex market but here’s the thing: if someone says something that is too good to be true then guess what?
The chances are, it is!
13. Keep Trading Simple. Both Your Trade Plans And Analysis Should Be Easily Understood And Explained.
Usually when it comes to being successful in forex trading, it all comes down to only one thing: keep it simple. Having complicated forex trading systems, trying this and trying that, reading this and reading that, jumping here and there and not really learning anything…all these are just confusing the heck out of you.
Just settle down and trade. Keep it simple.
14. Don’t Trade Against The Trend
If you have a huge trading account that can take on the massive draw downs, then go ahead and fight the markets…fight the trend.
15. Understand That Forex Is About Probabilities.
16. Be Humble And Patient And Wait For The Right Trading Setups To Form
If there is no trading setup forming, then don’t force yourself to take a bad trade. You got to learn patience. Wait and wait and wait more if the setups do not form. Be patient.
17. Share Your Trading Experiences. Follow Your Own Judgment
When you trade forex, make your own decisions. You are in control of your decision to buy or sell.
18. Study And Master Money Management In Trading
You master this and you will make money trading: trading risk management.
19. Study The Markets, The Fundamentals, and The Technical Factors Leading The Price Action.
Why is this? Because you can connect the dots up and know that a good trading setup is forming or not.
Learn to study price action trading. Learn about how the market fundamentals impact the market and how these are reflected on the chart by price action. And use the price action to trade.
20. Don’t Quit Trading Just Yet….
If you blown your first $1,000 forex trading account, then congratulations! Welcome to the forex university. Consider your loss as a tuition fee. Ask yourself why you busted your trading account. Then fund your trading account and try again….don’t give up yet.
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