Learn to trade forex
Forex trading is a shorthand way of saying Foreign Exchange trading (or Currency Trading). Before you even start Forex trading, you need to know some basics. Let’s go over some of them so that you’re more equipped to handle the Forex market overall.
1 – There are eight major players in the Forex market. Unlike the stock market, where you need to follow hundreds or even thousands of stocks in your Watchlist, there are just eight major currencies that you have to follow to find the opportunities for undervalued and overvalued currency pairs: the United States, United Kingdom, Canada, Australia, New Zealand, Japan, Switzerland, and the Eurozone.
Economic data is released on a regular basis, and this will allow investors to keep on top of the game when it comes to figuring out the health of every country and its economy.
2 – If you have no knowledge about the financial markets, then it’s a good idea to get a good book on technical analysis. Learn the Forex basics and learn how to read a chart before you start trading with real money.
3 – Define clear money management rules for your strategy. This is an extremely important step that most Forex traders forget about. Having strict money management rules is what will allow you to reach consistent profits in the long run.
4 – Now, you’re almost done with your Forex strategy. Make sure you make a detailed trading plan where you write down not only all about your strategy, but also the possible outcomes of a trade and what you should do. This will allow you to act fast when you’re trading with a real account.
5 – Now it’s time to choose a good Forex broker. Make sure the broker is regulated and that has a good reputation among other traders.
6 – It’s time to test your strategy, so you’ll need a demo account because this will allow you to trade with virtual money. Most Forex brokers offer you Forex demo accounts for free. This demo account can be used to try out the market.
7 – Open a real money account with the Forex broker you chose. Make sure to start small. Remember that your goal is to make consistent profits and it’s better to have several short wins than a huge loss.
8 – Keep annotating all you do in a Forex trading journal. This will help you improve your skills and adapt your own strategy when you feel it’s time.
9 – There’s no better day to start your journey than today. Learning to trade Forex successfully takes time so the sooner you start the better.
Don’t feel overwhelmed with these steps. They’re just here to ensure that you take the steps in the right direction.
Making money in the Forex market is possible but it’s not easy. You need to commit to it and have patience. There’s always a lot to learn and you’ll discover that as soon as you start trading. Make education a constant part of your trading and you’ll greatly improve your odds of success.