Steps to learn trading

I just wanna share what i have read, hopefully it's helpful.

 

If you are interested in learning to trade forex successfully, then the most common path for an aspiring trader these days is to search the Internet for information to apply immediately to their live forex trading account. The problem is that their search often leads them to destinations where there are plenty of false promises, bad ideas, negativity and an obsession with indicators. Many of the EBooks on sale today are filled with recycled concepts or incomplete strategies which the authors themselves do not use. Many authors do not earn money from forex trading but they earn their living by selling these EBooks to the novice forex trader.

 

This easy access to forex guru's who fuel the idea that forex trading is the holy grail of easy money, then financially feed off those same people they have sold this idea to. At the end of the day what many of these forex guru's sell is a gross misrepresentation of what it takes to trade forex for a living.

 

Forex Trading is not easy. You can become a good forex trader though dedication and by treating forex trading as you would any other skill. The reality is that it is hard work and must be treated with the same amount of seriousness as you would any other career.

 

The effect of all these gurus is that many forex traders start off overly optimistic with unrealistic goals. Whilst there is nothing wrong with a positive mental attitude but this positivity must be built on strong foundations and realistic expectations.

 

New forex traders normally start their career by purchasing some secret set of indicators and they are quickly punished for their naivety. Many of these forex traders then purchase a different set of secret indicators until they become disillusioned and then quit trading.

 

In fact, many forex traders that are now successful went through this learning process, including myself. This is only a problem if you refuse to learn from your mistakes. You need to break from this cycle of reliance on secret indicators and guru methods to be successful.

 

You help yourself in the beginning; by learning to think for yourself and understanding that whilst anyone can trade forex, to be successful, you must learn to BE a forex trader.

To BE A Forex Trader

 

To trade forex is easy, all you need is a forex trading account with money in it and then you enter the foreign exchange market and start trading.

 

To be a forex trader is more work. You need to grow from the starting point of having very little knowledge to the stage where you have a trading plan, understand the concepts and behaviour of the forex market and be able to trade with a cool head and understand that wins and losses are all part of being a Forex Trader.

 

Learning How to Trade Forex by thinking like a Forex Trader in Seven Steps.

 

1. Understand your place in the Forex Market

 

This is very important you must understand that you are very small fish in a big ocean.

 

In the Foreign Exchange Market the majority of the liquidity is coming from big banks and experienced institutional traders. These are the big fish. The big fish will happily enjoy you as a little snack.

 

You are only fooling yourself if you think it will be easy to take money off these big forex traders.

 

You have to learn to swim alongside these big fish and catch the same currents they do. Swimming against them just marks you as prey and sooner or later you will be eaten.

 

2. Learn to read the Forex Charts and Understand the Foreign Exchange Market.

 

Many novice forex traders believe that these big forex traders have access to some secret forex trading strategy or use a secret set of indicators, but the truth is this is just not the case.

 

These major forex players are using simple, but proven technical analysis techniques - most commonly horizontal support/resistance, identification of trading ranges, Fibonacci these are then coupled with fundamental themes.

 

Begin by accepting that the other major participants are highly experienced in the market and they make money because of experience and by a complete understanding of the core skills and not because they hold a holy grail of secret indicators.

 

3. Money Management

 

It is crucial that you understand as a novice forex trader the emphasis is not on how much you can make from forex trading but on how you manage what you have.

 

This is the most common downfall of all novice traders. It is common place to see a starting trader risk the majority of their account on one or two positions.

 

This style of trading is not sustainable and professional traders do not trade in this manner. Everyone sometime in their career will have a string of bad trades. A typical number might be 10 losing trades in a row. The question is do you have a money management plan in place that enables you to survive this?

 

4. Focus on the Market

 

Many novice forex traders open their forex charting software and activate their latest hot indicator or tool and proceed to place their trades as per the tools recommendations. This style of forex trading is unlikely to have much long term success.

 

When these indicators fail to generate the required profits then these traders then move rapidly on to another set of indicators.

 

You must focus on the forex market and understand what the indicators are telling you so that you can pick the forex trades which have the best probability of being winners.

 

Successful forex traders use indicators and tools as Fibonacci, Pivot points, price channels, MACD, RSI etc. These tools by themselves do not make a successful trader. There are many successful traders and unsuccessful traders who use the exact same indicators.

 

The key is that successful traders understands how the market behaves around the indicators and understands what the signals actually mean.

 

The best way to achieve this is to stop swapping between tools and select those that compliment your trading plan, understand how they work, and then spend time in the market experiencing them.

 

5. Plan your trade and trade your plan.

 

This is a common saying that seems to get lost on novice traders. It should be every trader's goal to make pips on each forex trade as per their trading plan. Forex Traders must treat each trade as a business decision by calculating their risk and defining their entries and exits points, those that do not open themselves to big losses when a trade goes bad.

 

Many novice traders seem to lack the discipline to follow a plan for each trade. So what happens is typically the following; a novice trader will see a potential set-up, they decide on some arbitrary sum to buy or sell with a quick guesstimate, then place the trade without analyzing any risk and having an exit strategy.

 

Of course this way of trading can be profitable over the short term, more down to luck than skill. But eventually the luck runs out and the trader is caught napping and a common result is a wiped out account.

 

The first question novice traders tend to ask themselves how much will I make on this forex trade?

The first question experience traders tend to ask themselves is how much is my potential loss / risk?

 

6. Your mind is your strongest asset and weakest link.

 

Entire books have been dedicated to the subject of psychology and its role in trading. That doesn't mean they are all going to help you, but you should take this as a sign that the subject is not to be ignored.

 

First you must understand the role psychology plays in trading. You must learn to understand your personality traits and how they might affect your trading style.

 

A trader I know is a bad loser and when he has a bad trade, he had a habit of going straight back and trying to win those pips back with even worse results. But he understands this as a weakness and when he has a bad trade, he takes a break of 20 minutes before he goes back to trading so that his emotions do not affect his trading decisions.

 

Second you must make it your aim to never stop learning. You cannot get yourself to a certain level and then become complacent. Every day is a learning experience in some way or other and you must be prepared to learn lessons and invest time in improving your skills and experience. The day you stop learning is the day you should stop trading.

 

7. Understand The Forex Market is always right or Expect the Unexpected.

 

The forex market is an interesting place, but there is one thing every trader needs to learn. Always expect the unexpected and do not get wrapped up in past successes. No matter what your charts or indicators tell you; sometimes the forex market will just do the opposite.

 

Whatever happens in the market you must maintain an objective outlook on your strategy and the forex market and ensure that bubbles and crashes do not derail you in the long term.

By following these steps and learning to become a forex trader rather than just trading the forex market, you will put you on the path to ultimate success as a profitable forex trader. This is something that 90% of all novice traders fail to achieve.

Is any one here who wanna give another advice for beginners to learn trading?

Please share here to help each other

Hopefully it also helpful :

1) Focus on trading, not just on making money

2) Learn that NOT trading is part of the game (Being out of a trade is a position)

3) Become organized and disciplined

4) Take a longer-term view of what “success” means

5) Develop a strict daily trading routine to develop positive trading habits

Long read but really useful post. I especially liked number 7, it reminds me of what my friend always used to say about the market.

Long read but really useful post. I especially liked number 7, it reminds me of what my friend always used to say about the market.

 

Yeah. that's why i post it in this forum, i hope it can help beginner so they can know, market forex can't be predicted with certainty.

Let me put a simpler version here.

 

Instead of learning the steps, let's get down to the trading plan itself. Every successful trader has a plan in place to help guide their trading approach.

 

A trading plan should include, but is not limited, to the following:

1. A daily trading routine

2. Sources for market news and events for an overall market view, to form a fundamental analysis

3. Chart time frame for analysis and time frame for entries and exits, to form a technical analysis

4. Entry and exit criteria

5. Market conditions to trade in, e.g., trending market, ranging market, significant news events

6. Trading strategies for the above market conditions

7. Currency pairs to trade and pairs to avoid

8. Market conditions to stop trading

9. Mental conditions to stop trading

10. Amount to risk per trade – i.e., money management

 

Anyway the best way to learn to trade is to have a mentor of your own. I would like to encourage newbie to check out FXPRIMUS Coach program.

Let me put a simpler version here.

 

Instead of learning the steps, let's get down to the trading plan itself. Every successful trader has a plan in place to help guide their trading approach.

 

A trading plan should include, but is not limited, to the following:

1. A daily trading routine

2. Sources for market news and events for an overall market view, to form a fundamental analysis

3. Chart time frame for analysis and time frame for entries and exits, to form a technical analysis

4. Entry and exit criteria

5. Market conditions to trade in, e.g., trending market, ranging market, significant news events

6. Trading strategies for the above market conditions

7. Currency pairs to trade and pairs to avoid

8. Market conditions to stop trading

9. Mental conditions to stop trading

10. Amount to risk per trade – i.e., money management

 

Anyway the best way to learn to trade is to have a mentor of your own. I would like to encourage newbie to check out FXPRIMUS Coach program.

 

Thanks for sharing, sir. And it's more easy to be understood and the last point must be remembered and applied properly by traders so the risk will be smaller.

Thanks for sharing

nice share...!

There plenty of ways to learn trading and its upto to the trader in which he wants to learn or decide the way he is comfortable with.

There plenty of ways to learn trading and its upto to the trader in which he wants to learn or decide the way he is comfortable with.

some new traders wont spare time to read long yet informative article. they find it bore, and too lazy to read structurally. one day he read about the basic, and then he jumped and read about expert trading strategies which lead to confusion. informative educational video are much better approach, i came accros and found Armada markets forex trading video tutorial contains hours of video dedicated to multiple Forex aspects you need to become a more knowledgeable trader.

some new traders wont spare time to read long yet informative article. they find it bore, and too lazy to read structurally. one day he read about the basic, and then he jumped and read about expert trading strategies which lead to confusion. informative educational video are much better approach, i came accros and found Armada markets forex trading video tutorial contains hours of video dedicated to multiple Forex aspects you need to become a more knowledgeable trader.

You was right sir, all learner will bored if they learning and read text. Using video tutorial is really more interesting for them.

In my first time when I was learning forex I read many ebook and its really boring.

Then I turn to trade in virtual in LITEFOREX.COM, and it needs 6 month to get well in trade..

well, some traders more prefer an informative way of learning, instead of reading they prefer to watch video tutorial, i've found many in youtube, but most of them are too long to watch, some video are over 2 hours duration in single link, found this one well informed video, and more interactive video tutorial, you can select which one you need to watch, based on your knowledge level, each video only at average 3-5 minute duration, you may check at http://www.armadamarkets.com/video-tutorials/

You have mentioned some valid points but problem is that most of the trader are so much in hurry to invest and make profit that they don't realise the importance of these steps and then, find it difficult to trade when they enter the market.

You have mentioned some valid points but problem is that most of the trader are so much in hurry to invest and make profit that they don't realise the importance of these steps and then, find it difficult to trade when they enter the market.

 

Yeah that's right, it is a the most widespread problem why traders lose. That's why I advice to every of them to work out sound and thoroughly considered money management plan before taking plunge to the risky forex market. Hotforex webinars which I frequently attend also aimed on making traders aware of improportional risk they take without managing their capital correctly..

it's all depend on trader needs and should match with their current trading method used. personally I use most popular method, scalping strategy. The fundamental characteristics of a great Forex broker for scalping are : The spread must be low; which is a vital variable in choosing a broker for scalping. has a quick execution of requests so we able to trade more requests in only one second. got mine with Tickmill ECN account type, which fully satisfies it all. high execution process supported by numerous liqudity provider they use. Low cost trading fee, with 0.3 pips average on EURUSD trade, I've got smaller spread during volatile market event, and they had no restriction for any kind trading strategy use.

isnt tickmill armada? what happened that they had to change names?

isnt tickmill armada? what happened that they had to change names?

 

they're practically the same. if you ask the main reason, may directly ask their support for detailed information. I also receive their email notification backthen, and based on these email there's nothing to worry about these change. I assume the main reason is to create new business, after they turn into tickmill CFD instrument are introduced, new client 15% deposit bonus are added (only for new one, mine doesnt count to get this promotion :( ) . but since they put another promotion deposit bonus for all client.. quite happy seem they also give more value of their current account not just for new client registration :).

Yes its important to have a plan before trading, you should plan on how you are going to enter the market and what are pre requites for trading.

I started my Forex trading career practicing on demo account for almost 7 months. And then when I realized, Yes I can jump on live platform, I deposited my funds only then.

Thanks for sharing ..

I started my Forex trading career practicing on demo account for almost 7 months. And then when I realized, Yes I can jump on live platform, I deposited my funds only then.

 

Yes its very important to be patient and enter the market only when you are confident enough to trade alone.

I started my Forex trading career practicing on demo account for almost 7 months. And then when I realized, Yes I can jump on live platform, I deposited my funds only then.

 

You are really patient! I only trade during 3 months and then went live. I know that most of my friends couldn't even trade 3 months, they started real trading earlir. Sometimes it had bad effects, coz they lost their money.

Yeah. that's why i post it in this forum, i hope it can help beginner so they can know, market forex can't be predicted with certainty.

Thanks for that. Beginner will know more and more about market.

You are really patient! I only trade during 3 months and then went live. I know that most of my friends couldn't even trade 3 months, they started real trading earlir. Sometimes it had bad effects, coz they lost their money.

Traders must be patient. I think its main quality that makes professionals. Gamblers lose their money quickly when they start to lose and traders are able to recover even after 50% drawdown (of course if they bring their account so such loss). My R/R ratio at HF is around 0.5 it means risk is around 0.5 of reward amount from a trade.