THE FOREIGN EXCHANGE MARKETS are getting increasing attention as the tool of choice for traders old and new. One of the great attractors is that there is usually a trend somewhere in the forex markets. However, newbies should start with these three crucial steps:
1. Go to school. I highly recommend the Babypips’ website for introductory and intermediate learning to get a better idea of what you are getting yourself into. It’s friendly and informal, but covers a lot of basics. From learning what a “pip” is to relatively complex market correlations, they provide an excellent entry point for beginners.
2. Download a charting software. Most traders use Metatrader. I recommend you download Metatrader 4. This is a software shell that is leased to various brokers. You will want this to see some charts live and to get used to how the software works. I do not recommend any broker in particular, but FXCM’s Metatrader will give you the widest range of trading instruments on a demo account. You don’t have to put money in it (for any broker) until you’re ready to go live, but this gets you started with the charts.
3. Figure out what works for you. There are many downfalls for a trader, and especially a trader of the Forex markets. Before you begin to develop your trading strategy, be aware of the psychological blind spots that ruin many careers – these little known psychological biases MUST be taken care of!
4. Develop your strategy. For this, you will need to understand what components constitute a well-formed strategy. I’ve talked a little about that here. Don’t forget about exits as well. Then you have to backtest, backtest, backtest. In order to avoid all the nasty little biases, use a simulator that prevents you from seeing what is happening next in your price action. Then, trade your strategy to see if it actually will make money in all market scenarios. This is a lot of work, but this is the one thing that could accelerate your personal trader process beyond your peers’.
Don’t have a trade simulator? We’ll give you one. Send us a message via the contact form below. Or to find out more about what we can do for you, go to www.straighttalktrading.com and you can use the contact form there. Just ask and we’ll send it to you, at no charge. You will need to have Metatrader installed first, though.
With best wishes for your trading,
Private Fund Trader/Head Trader Consultant
“We take your trading seriously. You should too. Make It Pay.”
– Due to the demanding nature of personal attention required to provide trading success, only a few personal mentoring spaces are made available. Nothing personal – our own trading comes first, and if we commit to helping you, we want to do our best. Enquire via the website form (bottom of page). First come, first served.