Beginner forex traders

Many beginner FOREX traders get into FOREX because they are told that it is easy money and that FOREX is risk free. They are promised high returns for low investments. They are told that FOREX trading is easy. While some of this is true, some of it simply is not. In fact, FOREX can be very complicated, and if you don’t know what you are doing, you can lose your money. FOREX is not, by any standards, risk free.

Beginner forex traders

The first mistake that the beginning trader often makes is not having a trading strategy. The second mistake is letting emotions affect their trade decisions. Obviously, when you open a FOREX trading account with a broker, you want to get started right away. But it is best to step back, and start reading and learning first.

Don’t feel like any money making opportunities are passing you by – the FOREX constantly changes, and there are constantly opportunities to take advantage of. If you dive right in, you may rush to buy, see the price fall, quickly sell the currency off to prevent any further loss, and then find that the price shot back up – after you’ve sold of course. This is a sure fire way to lose money. So, after opening your account, don’t do anything as far as trading. Instead, start learning, and start putting together a strategy.

You need to have at the very least, a basic understanding of the FOREX market, and how that market moves.You need to be able to read charts, and to use those charts to determine your entry and exit points in a market. You must also learn how to use the tools that are available to you to get the most profit, while taking the least amount of risk.

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beginners forex trading tutorial

Visit FOREX traders forums. Talk to friends and associates who play in the FOREX market. Find out why they are in the market, if they are successful, and what has made them successful. This will help you to build your own trading strategy as well.

Understand the five different groups that play in the FOREX market: Banks, Corporations, Investment Funds, Governments, and Traders (like you). Of these five groups, there is only one group that doesn’t have any external control over the FOREX market – the trader. At the same time, however, those other four groups are accountable for their trading practices and decisions. They have rules and procedures that they must follow. You do not, as you are only accountable to yourself.

But at the same time, those other four groups are successful in FOREX because they have the discipline that is governed by rules and procedures. Your set of rules and procedures is governed by the strategy that you develope. Without that strategy, you are playing a losing game

beginner forex trading strategies

You have to learn how to manage your resources, just as banks, corporations, and governments manage their money. Your money management plan has to be incorporated into your trading strategy. Before entering a market, you need to consider your recent profits and losses, the margin, the size of the position you are going to take, and you need a ‘plan B’ as well.

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Money used in open positions, subtracted from your starting balance, is your core equity. For instance, if your starting balance is $20,000, and you have $2000 in open position, the core equity would be $18,000. In the beginning, you want low risk, so you should limit that risk to between 1% and 3%. You can set loss limits with stop orders. You can also set profits with limit orders. The stop order will sell the currency, automatically, if it falls to a certain value, and the limit order will sell the order automatically when the value rises to a certain amount.

As you profit, and your core equity increases, you may want to take more risk, protecting your initial investment. If you made a $5000 profit, and exited the market, your core equity is now $25,000. You could enter the market again, this time investing $2000, but setting stop and limit orders at a higher percentage of loss or gain, and even if you lost, you would still be ahead of the game.

Beginner forex traders