If you want to learn how to start Forex trading, you are in the right place. Making first step is always the hardest. It is the same with investing on Forex market. Surely you are wondering whether it is the time to invest your own money but you are not sure about your skills, you do not know what Forex is and how to deal with it. It is nothing unusual. Everyone who is serious about money had this kind of dilemma. Risking your own money on financial markets is going out of your comfort zone – a lot of stress and uncertainty about rightness of your decisions. No matter how long you will study and how long you will spend on Forex demo account there will be time to jump into the deep end.
When you will make this step it does not mean that the beginnings will be easy. Every single decision is connected with risking money again. However it is important to know that in pair with experience your immunity to risk will rise what will help you make another decision about opening or closing transactions. Trading on Forex market is like any other new activity – we need a lot to start it, equally lot to fit in new situation and after some time it will get easier, some day it will become daily routine. You should make your trading a daily routine and you should make money on it – this is how to start Forex trading.
Forex trading for beginners – for whom Forex is?
Primarily, what is Forex for you? Unfortunately academic preparation and experience is not all. Very important is also amount of your capital, it has great important when you create investment strategy (about which we will say few more words later) and individual predisposition. You cannot be good in everything. Not everyone is suited to be a doctor, teacher, politician and the same not everyone can become a Forex trader. It is brutal truth. Big volatility of currency prices, mass of incoming news having different impact on the markets and all of this strengthen by mighty leverage causing visible changes to your trading account balance.
Investing small capital using high leverage can lead to the situation that in the beginning you will lose everything or double your capital. This kind of Forex trading is not recommended. However among beginning traders this kind of behaviour happens very often. This is why we should remember not to invest money we are not ready to lose.
Another issue you should think about is time, to be exact amount of time you can sacrifice on trading. It is quite hard to become a scalper if you work full time and you have family. In this case it is better to invest in middle or long term. Besides that, more time you will spend on learning, easier will be trading in the future. So time to answer the questions how to start Forex trading and how to trade Forex.
How to start Forex trading
First of all you need to get basic knowledge about financial markets, Forex market, technical analysis and fundamental analysis. If you are reading this article, you just started to get this knowledge. It is worth to read some books about financial markets – it will be your first step on the way to profitable trading. About worth to read books you will find out more soon. In addition get to know indicators and tool of technical analysis. Also check trading platform and examples of investment strategies. These materials you will find on TradersArea.com. It is important to learn properly. It is not enough to know the basics, it will not let you be successful on financial markets. When you will finish this process you can start move on the markets using demo account to learn how to trade Forex.
First purpose of opening demo account should not be beginning of trading but choosing proper Forex broker. There are many investment platforms, brokers’ offers are different and additionally there are three types of Forex brokers – Market Maker (MM), STP and ECN. You have to choose offer which the best suits your plan and preferences. When you will finally choose an offer suited to your needs it is time to create trading strategy. How it should look like you should probably know now because you checked example strategies published on TradersArea.com. Does created by you investment strategy bring virtual profits on Forex demo account? No? It is time to improve it, regulate it or change to some other. And test again. Until a success in Forex trading.
When your target will be reached it is time to jump into the deep end. However it will not be easy. Why? Earlier it was all based on knowledge, numbers, data. Neither learning, neither trading with virtual money will bring emotions – Forex trading with your own money is totally different. It is hard-earned money and although we are ready to lose it and we can afford it, we do not want to lose. This is the main difficulty of starting real trading. It is important to start on Forex market with small trading account balance. They should let us open positions without too big leverage but still be small. And then? Practice makes perfect. Be careful, stick to your investment strategy. As long as it works – use it. If it stops – come back to demo trading account and adjust it again. Do not lose money unnecessarily. Now you know how to trade Forex.
Investment strategy – how to make money in Forex
Investment strategy which we mentioned earlier is the culmination of whole process of preparing to profitable trading. It is responsible for trading on Forex market to be profitable in comparison to time you spent on learning and you spend now on trading. First of all you need to use strategy which you understand. It is not enough to just download from the Internet some ready strategy which was described by someone as 300% profit in a week. You can of course take a look at some trading strategies which you can find online but you need to adjust it to the instruments and time frames on which you will trade and every aspect of this strategy should be clear to you. And the most important. Remember that before you start to risk your own money you need to test your strategy on demo account with the same rules you want to trade on real market.
How to trade Forex
Life of the trader is not easy. It is very time consuming and stressful. This is the reason why it is the only job for some people – source of money and way of supporting the family. Before they reached this level at which you can resign from other sources of money they were getting experience for years. Now they can certainly admit it was worth it. However, all of it must be in appropriate order. First learning, then demo account and in the end getting experience in the real account. Since you already know how to Forex trade, it’s time to start practicing…