By: How To Become A Forex Trader.
Six Key Factors
Forex trading is undoubtedly profitable and it can become your only source of consistent income. You can make it big in forex trading if you do things right. Yes, there are some things you must keep close to your heart when trading forex in order to make good profit out of the endeavor. In the same vein, there are some things you must run away from if you are not to make loses one after the other. Do you plan to go into forex trading as a beginner? Some of the important things you must do and keep in mind will be made known below.
Start out by defining your goal
Before you ever venture into forex trading as a beginner, you must first define your goals. What exactly do you want to achieve in forex trading? What is your desired profit margin? What is your desired style of trading? Do you plan to trade in the morning or you prefer to trade at night? Do you prefer to ride the market for long or you prefer to trade as a scalper? These are some of the very important things you must plan out before you ever venture into forex trading. You also want to find out about your personality. If the truth must be told, some personalities are not best for forex trading. You must first determine if your personality can withstand the mental and psychological pressures of forex trading, then you can go into it.
Who is your forex broker?
In order to succeed in forex trading as a beginner, you need to work with a good and reliable forex broker. If the truth must be told, the broker contributes a great deal to how successful your trading endeavor ends up. Never work with any forex broker if you do not feel comfortable with their terms and conditions and never open account with any of them if you have not taken time to read through their terms and conditions. If there is any uncomfortable item there, it is in your best interest to look around for another broker with better terms and conditions that you are comfortable with. Different forex brokers offer different kinds of trading platforms. Go only for those among them that are offering trading platforms that perfectly suit whatever your trading style is.
What method do you want to apply?
Before you start off on forex trading as a beginner, you must first take time to choose your trading method of trading strategy. First decide what your trading strategy should be. What method do you want to adopt? You must make up your mind if you want to make use of technical analysis or fundamental analysis for trading or you want to use a combination of the two. It is not enough to choose a particular trading pattern; you must also stay glued to that pattern. This will help you to develop further and make the most of your chosen trading pattern.
How to time your trade
You need to be methodical about everything you do in forex trading in order to get the best out of your trading endeavor. Firstly, you need to time your entry and exit very properly so as not to miss out on great profiting opportunity or make loses where you would have made loses. How can you do this? The best method to adopt involves using one of the shorter time frames for timing your exit and entry. Additionally, make use of the longer time frames to get the right direction of the market at any particular time. You must not add too many technical indicators to the chart so as not to get confused. When starting forex trading as a beginner, choose only one or two technical indicators to read the chart. You can increase the number of indicators you use as you progress and improve in your understanding of the forex market.
What do you expect from forex trading?
Before you even start trading forex trading as a beginner, you should first determine what your expectations are and work towards it. What is meant by expectation here is your financial reward for trading. If the truth must be told, you may not be able to meet up with that expectation the first few days in forex trading. But you will soon be able to meet up and even surpass that expectation as you improve in your trading. All you need are consistency and persistence and you will be there in no time.
Loses will come at times
If the truth must be told, no one can ever claim to have made no loses in forex trading. You must always keep this in mind that loses will come. When it comes, be ready to embrace it and move on. Each time you lose, take some time to find out what could have been responsible for the loss. This will help you to improve on your trading method next time for better profitability. When starting forex trading as a beginner, never allow anyone to stuff you with the wrong idea that you will never make loses. Of course you will make loses, but you must not let that fact weigh you down.
No Holy Grail trading method anywhere
One other thing that can easily deceive you when starting forex trading as a beginner is promise of unending profiting. The so-called forex gurus would tell you all sort of stories about the trading strategy they want to sell to you, calling it the perfect forex profit system. They would say the system had never made any loses before, only gains. Never believe them. There is no such perfect trading system anywhere that can give you only profit and no loses. You need to keep this close to your heart before you ever venture into forex trading. It will help to disabuse your mind about forex trading and will help wake you up to some of the unavoidable realities of forex trading.
One last message you must take home is that you must continue to learn in order to make something really tangible out of forex trading.