FOREX trading means putting in effort in the right areas, the problem for many novice traders is they listen to a lot of commonly accepted wisdom that simply ensures they lose.
When learning FOREX trading follow the simple tips below (many are NOT Accepted wisdom) but as the majority of traders lose that’s no bad thing!
Here are 10 tips to help you learn FOREX trading and be successful.
1. Don’t day trade
Perhaps the biggest error made by novice traders is to fall for the myth of day trading.
The reality is you will NEVER Make money long term and the odds are stacked against you.
Why?
Because all short term volatility is random – if it is you will never get a trading edge.
Don’t believe me?
Then ask a day trader for a real time track record (not a hypothetical one) and see if you get one – you won’t
2. Success means doing it on your own
Leading on from the above many novice traders think they can learn OFREX Trading by buying an e-book for 100 dollars and it will give them success.
The reality of course is if it were that easy a lot more than 5% of traders would be successful.
The only way to learn FOREX trading is to do it on your own.
3. Use a simple method
The best method to use is a breakout methodology using support and resistance and just a few confirming indicators.
Many novice traders think that learning FOREX Trading involves highly complicated methods – It doesn’t.
Simple methods are easer to understand, apply and more likely to succeed - as there are less elements to break in the real world of online FX trading.
4. Discipline
You will hear this is one of the most important traits to succeed in online forex trading and it is.
If you have a simple method you understand and have confidence in, then you will acquire discipline and can follow your system through inevitable losing periods.
You won’t do this if you use someone else’s method or don’t fully understand it.
5. Don’t mix fundamentals and technical trading
If you follow a technical system – ignore the news you can’t mix the two!
Sure those experts in the media tell convincing stories, but that’s all they are stories and their more often than not wrong.
Trade in isolation with technical system and don’t watch the news.
6. Don’t tick watch
Many traders sweat all day looking at prices – don’t.
It will upset your discipline and get your emotions involved.
Work off the closing price of the day and set your orders for the next day and ignore all intra day moves.
7. Money management take calculated risks
Most novice traders try to restrict risk so much they create it - by placing stops to close, or moving them to quickly.
Don’t fall into this trap.
To win and catch the big moves you MUST accept that the markets will eat into your open equity and you MUST give the market room to breathe.
Learning Forex money management is as important as getting market direction right in succeeding longer term.
8. Work smart not hard
You hear a lot of accepted wisdom telling you that you need to constantly learn FOREX trading to be a success – RUBBISH!
Once you have a method your confident in that’s it - execute it with discipline and don’t put any more work in if you have a successful method your all set.
9. Be realistic
We all hear of traders making millions in a year from small stakes, but their not the norm.
If you could consistently make 50 -100% per annum, you would be up their with the best traders in the world.
Try and make money to fast in FX trading and you will wipe yourself out.
10. So what’s your edge?
Before you start to trade online FOREX ask yourself the above question.
Why should you win - if 95% of traders lose?
If you can’t answer the above question, your learning FOREX needs to continue until you can.
If you work smart not hard, get a simple method you understand and can apply with discipline and accept responsibility for your success, chances are you will answer the above question and make some great FOREX profits!
Got a Question? Ask.
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Frequently Asked Questions
Does the method really works for intraday traders ...
By: chim | 26-10-2007
Does the method really works for intraday traders ? It seems like breakout strategy ?
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