Ten Tips to Help You Trade FX
1. Do your research! There are so many companies out there promising to make you a million without putting any effort in. Trading takes time, money and patience. You need to full research any company that you are intending to learn to trade with as well as reading all their terms and conditions. Also, go into it knowing exactly what you want to achieve from this training and budget how much money and time you want to spend.
2. Be realistic. How much time and money do you have to trade, and how much money do you need to make. Forex is fantastic for making money without having a million pounds in your account; however at the same time if you don't have any money to loose trading isn't for you.
3. Start on a demo account. Practise, practise and practise some more. Even once, you go live always test new strategies on your demo account for a minimum of six weeks. FXCM have a very good demo account. Whereas LMAX are great for live accounts (to receive lower commissions please email email@example.com to find out more).
4. Write a trading journal and keep an up to date trading log. It is incredibly important that you write down all the trades you place, where you go in, come out, how much you made and why you took the trade. Write a list of trading rules and stick to them. Too many people follow the hope that there is a holy grail and chase various strategies only to go back to the one they started with.
5. Brokers. There are so many different brokers out there and the mistake that so many people make when they start trading is to go with the first brokers that they come across thinking that they all offer similar packages, however there are some vast differences. Visit our previous blog 'How to Choose an FX Broker'.
6. Get a mentor. A trader who has proven results is worth their weight in gold, sit next to them, trade with them and your trading will benefit. The amount you will save from not having a mentor you will burn from your account through poor judgements.
7. Join a trading group. Trading can be incredibly lonely and one of the most common causes for people failing is due to over trading, isolation or boredom. It takes an incredibly amount of patience and dedication to sit days on end by yourself without any interaction with other traders. You need to find a group of traders who are trading successfully, trade in a professional manner and where you can learn from as well as teach those around you.
8. Prepare for your trading day. Treat trading as if you would any other job. Would you ever turn up at your office in your dressing gown and slippers, chomping on a bowl of cereal? I hope that the answer to that is NO, therefore why is trading any different. to get the best results you need to have somewhere to go and people to trade with, if you do not have this option set yourself a timetable and schedule.
9. Resources. Make a collection of useful blogs, gurus, forums and websites. Keep a close eye on news updates and alerts. Here are some blogs, forums and news sites to get you started.
- Bloomberg live TV -- http://www.bloomberg.com/tv/europe/
- BBC News - http://www.bbc.co.uk/news/business/
- Baby Pips - http://www.babypips.com/
- Trade2win - http://www.trade2win.com/
- Forex Factory - http://www.forexfactory.com/
10. Keep Going! Becoming a successful Forex Trader will take and then some more. It can become incredibly frustrating and time consuming, however once you make it the rewards are massive.