Just Another Forex Trading Story:
Basically, a trader was once a beginner at some point in his/her trading life. ‘Forex trading is risky, it is like gambling’ are the words one is likely to hear from someone who does not know anything about this business.
However, Forex trading story does not just happen all of a sudden in a trader’s life. Most traders stumble on Forex or at some point, would have been introduced to the business one way or the other.
Moreover, people trade Forex for some reasons but the main reason is to make a profit. Some will take a look at Forex trading and what it takes to be a trader, and after some thoughts, they simply walk away from starting the business considering the underlying risk.
Newbie’s First Time:
The bold ones, without any form of training, plan or strategy will jump right into Forex trading, thinking that currency trading is quite simple ‘one just need to click buy button when the price is going up or click sell when the price is going down’. After some time, the idea is finally dropped due to multiple or several losses made in the attempt to make a profit in the Forex market.
A serious-minded newbie will attend online Forex courses, get a mentor, research on the business, read e-books on strategies, practice on a demo account, create a trading plan, join social media platforms on Forex to learn and share ideas on how to be successful in the business and many more. This aspect alone might take up to three to six months or more.
Dos and Donts:
Knowing how to trade is one thing, making a profit from the Forex market is another hurdle while retaining profits without giving it all back plus the capital invested is the most difficult aspect of a trader’s story. Show me a successful trader that withdraws regularly from his trading account and I will show you an emotionally stable individual.
Many traders lose their trading funds primarily due to these factors; greed, fear, hope, over-confidence, indecision, no strategy, no trading plan, staring for too long on the trading chart, fatigue, anxiety and many more.
Opening and exiting trades poorly is one factor that affects newbies. Over-trading is another factor that sometimes affect even the experienced traders. Over-leverage from the Broker cannot be overlooked or swept aside. Some brokers are so wrong that they manipulate trades and trading account figures of their clients. You might want to select the best broker from the onset.
Trading on several currency pairs at newbie level can be quite confusing, try to focus on a currency pair at a time. Using big lot size, on a small equity trading account or under-capitalized account can lead to the loss of your trading capital in a very short time. Same applies to use of tight or small stop-loss. It gets hunted down quickly.
Not focusing when placing orders or when executing trades can lead to silly trade errors especially when the buy button is clicked instead of sell button and vice versa. Being afraid to take loss, inconsistency, trading on rumors, trading the news wrongly or interpreting the news incorrectly can be a set back for newbies.