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How to trade Forex?

Out of idle curiosity, they do not come to Forex, anyone who enters here pursues one single goal – to earn money. This wave is possible, Forex trading can bring a stable income. Each trader uses different trading strategies, methods and approaches for this purpose. So, having a common goal, traders go to it in different ways. Choosing your path is the most difficult task for a novice trader.

First steps on Forex How often do novice traders fail to understand how to trade Forex correctly? "Proper" trading involves a wide range of different aspects. The most important ones, for example, include:

1. the Desire to learn how to work on Forex

Very often, the eagerness to open positions ends when the novice "drains" his first Deposit. If his desire to become a trader is strong enough, after losing, he will find the means and strength to "get back in line". Of course, he must analyze his loss and take into account all the mistakes he made. 2. Psychological training of a traderThe psychological factor in trading is of particular importance. Patience, self-control, and the ability to control your own emotions and not succumb to the "herd" reflex inherent in the market "plankton" are factors that help a trader keep any situation under control. 3. The ability to learnA trader may be eager to understand the theory of market trading, but if he has problems understanding simple school subjects, it will be difficult for him. He can easily start trading Forex, but the result of his trading may be questionable.

4. The tendency to analysisRegardless of the results of trading, it is necessary to constantly analyze every working day, every transaction made. This is important for identifying patterns that help / hinder the trading process.

5. Make informed decisionsNo one will decide for the trader which lot he should enter the market, when it is possible to open/close a position. No one will tell him to use a particular trading technique, where and when to apply a particular trading approach. Undoubtedly, in the course of training on some courses such as "Forex for beginners", as recommendations, he will be given tips by a coach/teacher. But this stage will soon be completed and the newly minted trader will be one-on-one with the market. He will have to make all trading decisions independently.

6. The availability of seed capitalThe opinion that it makes sense to start on Forex only on a large Deposit is wrong. There are examples when a trader went up when starting to trade on a cent account, the trading rules are the same for any deposits. It does not matter what size the initial capital will be, it is important how the trader will dispose of it.Of course, a large Deposit will allow you to exit a large lot and withdraw a large profit. But in the case of drawdown, the loss will also not be small. According to the "risk / profit" ratio, both a small and a large Deposit are equal to each other and are exposed to the same risk. The difference between them is only the lot size.

7. Free timeWe have already mentioned that you can trade on the Forex market using different approaches and methods. In any case, each of them requires that the trader devote a certain part of his time to Forex. When manual scalping, for example, the trader must always be at the monitor. It is important for him to track the market situation and the slightest price fluctuations in order to open/close positions on time.Profit by scalping per trade on average is 2-5 points. Imagine how much time a trader needs to spend to collect their daily profit? Sometimes the number of transactions per day is measured in the hundreds. However, today you can trade using special trading robots-day and night "scalpers", but even their work must be periodically monitored.In addition to all the above, the trader needs to have a workplace and appropriate equipment – a computer or laptop, as well as access to the Internet with high data transfer speeds. A weak Internet connection can cause a loss of connection with the broker and cause a loss on a transaction that is not closed in time.Novice traders often do not understand the very principle of making a profit on Forex. It is important to understand the nature of its formation in order to obtain a stable income in the future.Where does the profit come from? The mechanism of speculation on the stock exchange is simple – "buy cheaper", and "sell more expensive" or Vice versa. Remember, Forex trading is about making a profit from the difference between "buy/sell" or "sell/buy" prices. This is a real currency speculation-a commodity that on the currency exchange some are ready to sell/buy, and the second are ready to buy/sell. Let's look at the simplest example of trading "on the rebound" from the support/resistance line:In the figure above, there is a Support level 1 and a Resistance level 1. Next, you can see how the price breaks through the Support level 1 and goes further down, and the Support level 1 becomes the Resistance level 2, because at the retest, the price cannot break it and bounces off it, going down. Further it is seen that a short pulse movements price still fails to break Resistance level 2, then she rushes up Resistance 2 again turns into a Support level 1.Here you can open a buy position, both on the price breakdown and on its rebound from the Resistance level 2. After the breakout, the price rushes to the Resistance level 1, so the closing of the purchase transaction occurs when the price reverses from this level. When you close a " buy " deal, you can immediately open a sell deal. Now, let's see how successful Forex trading was, and calculate the profit on the purchase:Opening price = 1.15695Closing price = 1.16025Difference (1.16025 – 1.15695) = 330 (points)This "difference" of 330 points is the trader's "profit" on this trade.Now we will convert these points to the currency ( $ ) and find out what profit in monetary terms the trader received:Let's say that he entered a lot equal to $0.1 and earned $1 on each point, then his profit was $330. A lot equal to $ 0.5 would bring him a profit – 330 points x $5 = $1650. If he entered a lot equal to $1, at each point he would take 10 times more, i.e., he would earn 330 points x $10 = $3330. It is clear that the amount of profit depends on the size of the lot – more lot, more profit and Vice versa, less lot – less profit. Remember that Forex trading is not only a way to make a profit, but also a risk of making a loss. A big mistake for a beginner will be to enter the market with a large lot with a small Deposit. If the price suddenly turns around and goes in the opposite direction when the position is open, the loss can be the same 330 points. Now, calculate for yourself what lot the trader had to enter the market and what volume his Deposit had to be in order to withstand a pullback of 330 points?Competent traders do not allow such situations, they close unsuccessful deals in time so as not to waste time and nerves waiting for a miracle. It is better to lose a little in order to be able to open several new successful deals and cover a small loss with the profit received on them. Beginners who do not know how to trade on the Forex market usually "hang" on such transactions and long languish in anticipation of when the market will turn around to face them. Some of them open opposite trades in a panic, simultaneously increasing the volume of the lot, and again observe the sad picture – the market has turned around again, but not so much that it was possible to close the first trade with a profit. Now there are two deals "hanging" in the market and both are in a good minus.Ignorance of the market, its functioning principles, trading rules, basic greed for their own money and panic-these are the main enemies of a novice trader. Remember, Forex for beginners can be harsh and even cruel, but its lessons are very effective and give a significant practical experience. It is not necessary to treat trading as the main way of earning money from the first days of trading. You will still have time to quit your old job, this will not happen before your income on the stock exchange becomes stable and regular. Where can I learn to trade on the Forex market? A beginner usually learns about Forex by accident and immediately strives to "go learn to be a trader". The wording is incorrect, because only regular practice will make a trader out of it. At courses or schools of training in Forex trading, they will learn to understand the specifics of the market and the principles of its functioning. There they will also learn about the basic rules of trading, learn how to analyze the market and use trading tools. All these are the basics of market trading, on the basis of which a novice player must develop their own trading tactics and strategy.It is not so difficult to start trading on Forex as to hold on to it and, if not to increase, at least not to "lose" your capital as much as possible. There are two ways for a person who wants to become a trader:

1. Take a special training course at the trading school.As many believe, this is the easiest and fastest way to become a trader. It should be noted at once that not every school and not every course of study is equally useful. Most often, this service is paid, and it is difficult to say how effective the training process will be, especially for a person who does not understand anything about the specifics of the issue.During the course, the teacher will do everything to make you feel like a "seasoned" trader. Very often, such courses are a bait to attract a novice to trade, forcing him to take a Bank loan to open a real account. Usually, the first Deposit is "drained" by a newly minted trader in a few days, and the obligations to the Bank remain... Be careful.Positive aspects:Choosing the form of training (paid/free, full-time/distance). Guaranteed acquisition of a certain knowledge base for a specified period of training.

The control of the acquired knowledge by the teacher is a stimulating factor for learning. Negative side:Financial expenses (if the paid form of training is selected). The influence of the teacher's subjective opinion as the primary source of the information received on the novice's worldview. If his opinion is not quite correct or erroneous, it will be difficult to get rid of it in the future. This is due to the fact that everything said by the teacher, the student is always inclined to perceive as the immutable truth. The effectiveness and quality of training depends on the competence of the teacher. A very nice offer from the teacher to open a real account with a fairly large Deposit in his company.

2. Learn Forex trading on your own.This method is considered complex, difficult, and time-consuming. But, remember the popular saying "Live forever-learn forever" or the aphorism "there Is no limit to perfection". That's right, Forex for beginners and experienced traders will always throw up riddles, which should be solved throughout the entire trading practice.There is a lot of printed and electronic material for self-learning today. In whatever form you choose the "source of knowledge", you will definitely acquire the necessary basic knowledge about how to trade Forex correctly. It is also important to understand that without a reliable and effective trading strategy, it will be difficult for you to succeed in trading.Positive side:Free learning method. Training at a convenient time. The ability to draw conclusions independently, based on information obtained from different sources. Negative side:Processing a very large amount of information that is difficult to understand at once. The process of understanding "what's what" will be faster if you start trading Forex using a demo account in parallel with the training. The absence of a person nearby who can prompt or" on the fingers " explain some nuance that hinders further progress in training. But even in this case, there is a way out – contact the Internet. On specialized forums today, you can find the answer to any question. It follows that both methods of learning are acceptable, and everyone has the right to choose the method that seems easier and more accessible to them. Against the background of many differences between them, they also have a common feature – neither in the first nor in the second case, no one will give you a good trading strategy. A real trader should develop it independently, taking into account the experience of other traders, using their own trial and error.Training is an important stage of learning the Forex market for beginners, without which they will not be able to become a trader. It is better to learn the basic concepts yourself. You should go to the courses if you need help in learning trading methods and strategies.For example, the vehicle "Sniper X" has already been tested in practice by a huge number of traders and has proven its effectiveness. This non-indicator trading system brings stable profits, no matter how well you know the Forex market. Forex Academy offers you a free basic training course on "Sniper X", so that you can start today and every next day, consistently get your profit.Where to start, what to strive for? Before you decide that it's time to start trading Forex for real, on a real account, you will have to go through several difficult stages. Let's write them down as a simple sequential algorithm. So, you will have to:Learn the basics of trading in order to correctly understand the events taking place in the Forex market. Practice for some time on the demo account, excluding the possibility of receiving a loss of real financial funds. Find a trading strategy that best suits your character, temperament, and trading method. Determining the risk level for your Deposit and for each transaction, studying the rules and principles of money management. The study of methods of analysis of the market. Familiarity with technical tools (indicators, oscillators, Gann lines, Fibonacci lines, etc.). Improve yourself and work on improving your trading strategy. For beginners, the question of finding a reliable and profitable trading strategy is particularly acute. That's right, because there is no universal recipe for where to get it. To shed some light on this topic, let's look at the existing types of trading systems:Indicator vehicles Even in the simplest version, they can bring a good profit. They are a combination of several indicators and have clear trading rules. They contain specific instructions on when and under what circumstances you can open/close trading positions. For beginners, Forex trading usually begins with the use of such vehicles. Sometimes, due to changes in the market, such systems need to be upgraded. This circumstance can be considered their only drawback.Graphical method Today, this method of trading is considered the most reliable and profitable, so you can start trading on Forex using it even on a demo account. Initially, the difficulty is only the lack of skill to see certain graphic designs on the chart, but this comes with experience.Unlike indicator systems, the graphical method does not require upgrading, since it is based on trading "by levels". The principle of building "resistance/support" levels is always the same, regardless of what is happening in the market.In addition to levels, this method considers various patterns and graphical shapes on the chart. Their formation tells the trader about the continuation of the trend or the beginning of its reversal trend. The difficulty here is that the trader can not always correctly recognize them.Trade " on the news» News trading refers to high-risk methods and can be used as a backup vehicle. In the Forex market, trading on news is not safe for novice players. News – as the only reliable source can not be considered. Before making a decision "on the news", check their reliability, study their impact on the market with the help of other vehicles.Candlestick patterns It so happened that the method of trading on candle patterns – certain combinations of Japanese candles, is not very popular among traders, despite its high efficiency. Although Forex trading on the TS "Price Action" patterns has become widespread, it does not have many adherents. Working with Price Action patterns involves using them simultaneously with other graphical analysis tools. These include trend lines and horizontal levels more often. This method requires the trader to have certain skills in recognizing patterns on the chart. This skill comes with experience as a result of daily practice.As you can see, it is quite easy to start trading on Forex, it is more difficult to trade for profit, rather than at a loss. This requires willpower, patience, a desire to learn, and the ability to take every trade seriously, and to make important trading decisions in a balanced and reasonable manner.If you do not want to risk a large Deposit, start trading on a cent account, so as not to stay long on virtual trading. Try to "grow" your capital and don't be afraid to use new vehicles that were previously "tested" on the demo account or in the strategy tester.Don't forget that the demo account is very useful as a training simulator. However, with it, you will never experience the same emotions and responsibility as in trading on a real account, even if it is a cent. As practice shows, Forex for beginners is a kind of "Pandora's box", which is fraught with a mystery. How dangerous it will be for the trader depends only on him and on his efforts in training. There is an opinion that Forex trading requires some specific mathematical and economic knowledge. This is an incorrect judgment, because in the history of trading there have been and are today very successful traders with a liberal arts education. In a number of successful "gurus", there are traders without any higher education at all. If you are an expert in Economics or higher mathematics – this is your bonus and only. You will find a use for it, so you will strengthen your position on Forex and increase the percentage of profitability on your transactions.A serious problem for traders is the repetition of the same type of mistakes. After completing the training and making the decision to start trading on Forex, the trader does not cope with his psychological state. When opening a deal in one direction, he can hardly survive price fluctuations, begins to panic and makes serious mistakes. Analyzing the history of his trading, he understands the reason for these mistakes, but he repeats them again and again, unable to cope with his own emotions.Summarize The mechanism of trading on the Forex market can not be called complex, its entire algorithm is reduced to pressing one of two buttons in the terminal – "Buy"/"Sell" ("Buy"/"Sell"). The difficulty arises at the stage of analyzing the chart and price fluctuations to make a decision about opening a trading position. As a rule, to analyze the market situation, a trader uses the same methods and tools to search for entry points/exit from the market-others. The trader's path to success is thorny and difficult, but if it is passed, success will be provided for him.

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