If you’re just starting as a forex trader, there are certain things you should equip yourself with. There may be several traders who made a lot of profit by making forex trading as a full-time job, but it didn’t take them overnight. It takes dedication, passion, and skill to make your way through the financial market. As a lot of traders will tell you, there’s no way you can predict the market and you’ll only hurt yourself trying. In this article, we’ll be talking about some insider secrets you should know on forex trading for newbies.
1. Choose top tier regulated brokers
The forex broker you choose can make or break the success of your forex journey. There are two kinds of brokers you should be aware of – regulated and unregulated broker. When you choose an unregulated broker, this isn’t reliable as they aren’t following the law. This means that if you encounter any issues with your money or transactions, you can’t sue them as they were never abiding by any laws in the first place. This is why any professional trader will tell you to choose regulated fx brokers instead and do your research in choosing brokers. The broker you choose should be regulated and should not have any bad reputation in the past.
2. Take on forex trading courses
While there are several free videos and articles that are accessible to expand your knowledge on forex trading, your odds of succeeding increase when you have a professional mentor to teach you all the strategies and tricks to forex trading. These are several courses you can take in which, you may or may not have a trading community. Having a trading mentor also keeps you accountable and motivated in your trades and you’ll learn a lot more from then than you will in any YouTube video. This is because they have been where you are and every successful and profitable trade once didn’t know anything about forex trading and the financial market. They will teach you everything you need to know to understand the market better.
3. Open a demo account
Before opening a live account, it’s best to open a demo account first to get a feel for how the market works. A demo account is also great for testing if your strategies and setups work and if not, you can have a trial-and-error on which trading strategy works for you. Opening a demo account gives you the closest feel of a real trading experience without the pain of losing real money yet. Once you’ve learned everything you need to know on trading and tested it on a demo account, that’s when you can open a live account and begin your trading experience. Demo accounts also let you see the spread and commission of certain brokers, including the instruments they provide.
4. Never forget your stop loss
Your stop loss minimizes your loss at a given point whereas your take profit closes a trade at a certain point. Between both of these, your stop-loss is more crucial especially when leaving trades overnight. Without a stop loss, your entire account could be blown because of a single trade you forgot to set a stop loss on. No matter how confident you are, never forget to set a stop loss in all your trades. This is also where the principle of risk management comes into significance. Setting a stop loss is how you can manage your risks properly without losing all your money. Also, in setting a stop loss for each trade, it shouldn’t be too high as this will defeat the purpose of a stop loss. Set it at an adequate number of pips that you’re okay with considering as a loss in your trades.
In conclusion, I hope this article was able to shed insight into the secrets you need as a beginner in forex trader. There’s no concrete answer in succeeding and profiting as a forex trader, but it all comes down to having enough knowledge to be confident in your trades. Asides from all the points mentioned above, follow the trading psychology of never trading with your emotions and you’ll be just fine as a forex trader.