If you are starting out in forex trading you need a quick forex 101 checklist to see that you can succeed where over 90% of others fail.
Actually, forex trading is not as hard as many people think it is, all you just need to do is keep these points in mind and they will lead you to success.
Let’s get started.
1. Only you can make yourself successful.
If you think you can buy success for $100 or so and follow a vendor blindly – you’re mistaken.
Even if you follow someone else, you need to know how and why their system works and most of the forex education sold doesn’t work.
Think about it:
If it did it wouldn’t be sold.
Fact is you won’t be successful unless, you understand why your method works and have the confidence to follow it with discipline.
2. Get a methodology that works
Avoid day trading, the odds are not in your favour and day traders lose – it’s a mugs game. You can’t find reliable data in short time frames so don’t try.
Either use a long term trend following methodology, or if you are the impatient type try swing trading.
3. Don’t over leverage
Take it slowly to start and deal in small sizes.
Most novice traders over leverage and blow themselves out.
Sure, the profit potential is bigger, but don’t forget the losses!
To win you need to play great defence first and then let your offence make you profits.
There are very few football teams that don’t build their success on firm defence and trading is the same.
4. Stops
Don’t place them in your head, place them in the market straightaway, to maintain discipline and only trade in line with your methodology, don’t try and force trades.
5. keep it simple
If you want to prove how clever you are, get a degree and don’t trade.
Another common fallacy is that complicated systems work better than simple ones and the harder you work the more you will achieve.
This may apply to digging roads but not to forex trading.
You get paid for getting market direction right, nothing else.
Simple systems work best and beat complicated systems, as there are fewer elements to break, in the face of ever changing brutal market conditions.
6. Pace yourself and be realistic
Sure there are traders who make millions quickly, but that’s not the norm.
The best traders make 50 – 100% per annum and if you can make these sort of gains you will soon be very wealthy.
7. Remember this equation!
Everything about trading can be specifically learned and everyone has the potential to be a great trader, however fact is most forex traders don’t win, so what’s the secret to succeed?
The secret is attitude.
This means applying the right knowledge and the equation below if you understand it can bring you success:
Work smart and learn the right knowledge + Simple method = Confidence & Discipline = PROFIT
You need to have total confidence in what you’re doing, this means working smart not hard.
Once this is achieved, confidence comes and this leads to discipline and longer term profits.
Trading success is mostly down to mindset.
You simply have to learn the right knowledge, have confidence and discipline and profits will follow.
It really is that simple.
We hope you enjoyed our forex 101 summary and wish you good luck in the world’s most exciting investment.
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