Becoming a Forex trader requires your time and attention. Forex trading is one of the largest commodities in the financial sector and because of this fact, there are many people who want to join the wagon and be a part of the train.
Forex trading demands that you are good with numbers are able to time markets successfully — which is self-control in other words, and patience. Without these skills in your pockets, you would soon end up in a hole, because when doing your forex trading, you would be tempted to do things out of impulse.
Forex is simply a battle with the next person, if you predict the right thing, you win. The profitability in this industry is mind-blowing. These 10 points I would list below would ensure that you become a successful forex trader.
1. DEVELOP THE RIGHT SKILLS
Self-development is very important when you are trying to start out your forex business because trust me, you are going to push sideways on a daily basis which may make you want to lose your calm.
· Diligence: You Can Achieve anything by not being lazy, you Should know by now! Just That. In the case of forex, diligence comes in when it is time to make transactions. When making transactions, you do not want to put your money into anything that you have not made prior research on. You should be able to make your research and find the good and bad parts of any deal before putting your money into it.
· Good Research Skills: Going further on the first point, good research skills are vital. You see that a currency has been doing well and is on the rise now, and you feel it is time to cash in your chips. Good research skills give you the ability to find the reason for the value fluctuation from different sources.
· Good with Numbers: Forex deals with numbers, graphs, and charts to show For you the Different currency patterns. You should be able to understand this easily in order to be a better forex trader
· Discipline: There are some Transactions That you may have ENTERED Into and for the first couple of trades, they make you profits and then you start to Lose. But you keep trying and trying until all the profits you made go down the drain. Many traders fall into this situation, time and time again. Before you enter into a transaction, it is important that you have a plan. Come up with trading strategies that you would stick to no matter what. After every transaction, try to record it down in a book, to keep you in line.
2. EDUCATE YOURSELF ABOUT FOREX
You have to learn the language of forex and how to time transactions. There are many courses in which you can take online which would put you on track. Learning the basics of forex is very important but not as important as the strategies.
The forex market is always changing and every day, there are new patterns. There are really no set of rules controlling the forex market to succeed, you need to be open-minded to new information.
There are basically two ways to keep you current about the latest changes. You can either learn from an online course or through a Foreign Exchange consultant.
Your aim should be able to talk about charts, graphs, ratios, trading options, and profitable pairs proficiently.
3. START SMALL
Probably your friend who introduced you to forex trading told you about how he makes thousands of dollars per day and you feel like you too can make that much immediately you start out as a forex trader.
Following such means would cost you lots of money and would make you really miserable. Rome wasn’t built in a day, so do not expect that your forex trading career would boom in one day.
Open a micro account, then write down how much you can risk losing in a journal and stick to it. This is where your discipline comes in; ensure that you do not make trades based on greed, fear, and biases. As you gain more experience, you can begin to increase the size of transactions you enter into.
4. START WITH A DEMO ACCOUNT
Starting with a demo account is very important for new traders who are yet to gain experience in the forex environment. It gives you a practical approach to learning the works of forex.
You would also be able to test different trading strategies and taking on transactions without having to lose personal funds.
5. FIND A TRADING EXPERT
This is what separates successful brokers from not-so-successful brokers. A trading expert is responsible for giving you expert advice on trading pairs and possible profit trades that would get you earning as soon as possible.
This trading expert would keep you safe from negative balance situations and would let you in on competitive trading options. Having this expert at your side is very vital to your success in the Forex trading industry.
Ask yourself these questions before picking an expert –Does his trading software suit your expectations? Do his profits and risk goals suit your personality? Is he or his trading software responsive?
6. TRADE WITH A STRATEGY AND STICK TO IT
Going into a trade without a strategy is a rookie mistake that anxious traders fall into. These people are quick to go into any trade thirsty for profits that they forget that they are meant to have a plan.
You develop your trading strategies from past lessons you have gotten from transactions. After every transaction, you should take some time back to find out the reasons behind why you made profits or losses in that particular transaction. When you do this, you would become more and more careful about future trades.
Your strategy should keep developing and getting better from time to time with the market; the deeper your knowledge, the better your strategy gets.
Decisions about making profits in the short term or long term should be identified in your strategy. Many beginners make one common mistake of jumping from one strategy to another, searching for the next best thing; the secret that many traders do not understand is, no strategy works 100% of the time.
7. DO NOT BE AFRAID OF LOSSES
Losing is part of the learning process, the more you lose, the harder it is for you to lose again because common sense demands that you learn from your mistakes.
Being scared of losses would make you scared of going into traders which would keep you failing continuously. You have to be okay with the fact that you can lose everything you can in the trading business. It is all part of the process.
8. KEEP YOUR EMOTIONS ASIDE
Forex trading is about 85% psychological and about 15% technical. What kills many people in the forex industry are their emotions. Your emotions are the things that would kill your growth.
Many people have their demons and things that they are fighting with. Some are faced with the fear of losing, the urge to get rich quickly to impress friends, greed to keep going; the list basically goes on and on.
There are some cases where you would not want to follow your strategies because of fear or the urge to win back your losses because you may have been on a losing streak. Kill that urge to go into trades without your strategy.
If you cannot put these emotions away, you would have a hard time as a forex trader
9. MAINTAIN A LOW RISK PER TRADE MARGIN
The type of forex trader you are should affect the density of the risk you put in per trade. You do not want to be risking big per transaction. It is not a good strategy to use.
Try to enter into high reward-low risk trades at all times. Your risk margin should not be more than 2% at any point.
10. USE STOP-LOSSES
Stop losses simply ensure that you have a particular amount in which you stop trading for the day. Many people just keep going until they get a negative balance — rookie mistake.
You can set your stop-losses based on market conditions because you never really know what the market will bring on specific days.
This is the secret of many successful traders. You have to enter into trade thinking about what you have to protect instead of how much money you want to make. It is that simple. Stop-losses go side by side with discipline, without discipline, be sure to sweep everything and have nothing left
11. KEEP PRACTICING
Practicing makes perfect, but in forex, practicing makes you smarter and more experienced. Because of how often the market changes, you have to keep learning. Follow news, market reports, and trends in the forex industry.
You would be better at trusting your strategies and not be controlled by your emotions.
In conclusion, if you do not have so much time to do trading by yourself and still want to maintain profit. Getting a Forex Robot that would do your trading for you. Forex Robots is a top-notch technology for foreign exchange. It helps ensure that you make profits from trades.
All you need to do is, let it know how much you are willing to risk.