Forex Tips for Beginners
If you would like to get involved with investing in the Forex market for the first time, getting valid and useful information before you get started could really improve your chances of making consistent increases in your Forex account. These Forex tips for beginners should be a great starting point.
Find a Low Risk Trading System
There are many trading systems and strategies in the market. You will most likely have to spend some money to find a proven Forex system that you could learn and master. It is recommended that you find a Forex system that is conservative in its winnings. Remember that with high returns come high risks. Aim for a consistent small monthly return. The effects of compounded interest will increase the growth rate of your account through time. Even a 2% to 4% increase of your account every month is a successful growth rate.
Be Disciplined With Your Trading
If you have decided on a trading system, make sure you test it on a demo account first until you feel comfortable with the system. Once you start trading with a live account, make sure to set weekly and monthly goals. If your monthly goal is to grow your account 4% per month, you can reach your goal by achieving 2% in the first two weeks and the other 2 in the second two weeks. If you achieve your 4% in your first week, then your target is reached and you can stop trading. Do this consistently and you are sure to grow your account every month.
Have the Proper Mindset
Making winning trades in the Forex market has nothing to do with trying to guess the price movement of currency pairs even though that’s what it seems like. Nobody can predict the future. Trading the Forex market is all about finding the trades with the highest probability to succeed according to a proven trading system. Traders always lose trades. Sometimes they lose more trades than they win. But at the end of the day it’s all about how much your account has grown.
Always Trade With a Stop Loss
Since not every trade is going to be a winning trade, the best policy is to always have a stop loss with your trade. A stop loss is the amount of money per trade that you are willing to lose if the trade goes against you. A safe amount per trade is usually 2% to 3% of your entire trading account.
Remember that trading is all about managing risk and your emotions. Rely on your trading system consistently, accept your losses, and make sure you reach your weekly goals. If you are having a losing day, or week, make sure you find opportunities to trade to make up for losses, but don’t get desperate and over trade. Greed and fear can quickly lead to a losing streak.
