Forex Trading
Online Forex and CFD trading for beginners can be especially tough. This is mostly due to unrealistic expectations that are common among Forex newcomers. What you need to know is that Forex trading is by no means a get-rich-quick scheme.
A Complete Forex Trading Beginners' Guide for 2018
Let's look at some valuable Forex trading tips for beginners.
You can always try using a risk-free demo account to get a better understanding of the market.
Risk free Forex demo account
The Retail Trading Food Chain
Knowing how the industry is mapped out is important, because the collective combination of all participants creates the market you trade in.
The relative weight of the trading party to the market, is measured by how much money that party manages – from billion dollar hedge funds and investment banks to private traders with a few thousand dollars in action.
Long-Term Vs. Short
The initial stages of your trading should be about preserving your capital – not trying to grow it. Minimising risk is the primary objective. One way to possibly achieve this, is to use a long-term trading stance.
What casual Forex trading beginners generally fail to realise is that most successful traders try to make a return on their investment based on long-term trends. They hold their orders open for weeks, months and even years. This way, Forex works as an investment and less as a lottery.
Long-term trading requires patience and modesty in trading volume.
And as a payoff, it requires fewer hours spent staring at the screen and therefore less stress. Mathematics is obviously useful in online Forex trading, too. And thankfully, there's some simple ways to calculate what balance, leverage and trading volume you need per instrument, to keep your risks in check.
Don't Overcomplicate Things
Don't overload your charts with indicators and your strategy with handles or switches. The more complicated your trading strategy is, the harder it will be to follow and the less likely it is to be effective.
To find out how well a strategy performs on average in different markets, you need to carry out the necessary backtesting and research. Keeping it simple can be a challenge, especially considering the multitude of supporting tools you can apply to your charts.
Just remember – it's not about the amount of tools at your disposal, but it is about being able to use a few tools well.
Reconsider Buying Software
Forex trading, for beginners or professionals, will require software. Competition between brokers means that most Forex trading software is available for free.
Many Forex trading beginners are also tempted to purchase FX robots a.k.a. Expert Advisers (EAs). While some EAs can be helpful, it can be hard for them to stay profitable when the market changes.
And unless you understand the code it's written in, you're probably not going to be able to adapt your EA to work with those changes.
If you are one of the many who believe an EA would outperform the market, then perhaps give it a try with the MT4 Supreme Edition plugin.
