Congrats, you’re now officially a ForexOfficial (pun intended)! As a newbie-trader, you could easily get stranded in all the jibber-jabber on the web about investing and trading. So, take it slow for now, learn the basics from a reputable expert, be patient and diligent.
But, if you feel that diligence alone is not enough for you to get off the ground, here are the Ten Forex Trading Tips that we consider essential for anyone eager to get into the Forex trading game. Anyone. That means, you.
1.Start from the beginning
Leaping directly into the deep end of the market without any actual history on the trading floor or understanding of the mechanics of investing is deadly. Take all the time in the world to rectify the situation, read, learn, talk to people, research and explore. Get a grip on the lingo, we can’t stress enough the importance of knowing the professional jargon.
2. Figure out your trading MO and stick with it
Investing techniques are created as often as they are later altered, only to be recreated and altered again in order to effectively exploit the ever tumultuous market. At least, that’s how the big boys do it. Not you. For now, the words to live by for you are “steady does it”, forget the “Holy Grail”, concentrate on concentrating, so to speak, and try to not get affected by losing trades (don’t kid yourself, the losses are coming, no matter how careful and smart you are).
3. Keep your knowledge base in one trusted place
Good thing, we have already taken care of that for you by creating a variety of courses on every possible investing strategy and trading technique one might encounter in the world. You’re welcome.
4. Don’t freak out when a trade moves against you. IT’S PERFECTLY NORMAL!
Of course, you’re not going to learn that playing with your training account: your subconsciousness won’t let you get really scared since the money is not real. No other way to put it: you WILL lose money - not only profits, but your principal cash as well - before you learn that by closing out trades one tick too early just because they’re too close to your stop loss you’re not doing yourself any favors. So, instead of fidgeting, study your position well, set your stop loss in a comfortable place and LET THE TRADE FLOW, don’t micromanage it, don’t lose any sleep over it. We call this approach “set and forget”. Be philosophical about it, who knows, maybe the next morning when you check out the trade you’ll be in for a pleasant surprise!
5. Remember the analog era
In our opinion, it’s useful to remember the times BEFORE computers (as hard as it can be to imagine, for three hundred years traders managed to make money without any help from us) when price movements were posted on boards in chalk and scribbled on slips of paper and tape. A trader was supposed to literally watch the price go up and down in order to interpret and speculate. With the introduction of the candle chart in the late 1700s’ by the Japanese grain merchants, things have gotten to the point they are today (naturally, the sheer volume of the today’s trade operations can’t be handled by jotting things on a wall, hence computers). The point is, it works. Using price action alone as a guide has worked for centuries, so why change that? More in part 2