Step #1: Educate Yourself
The first thing you need to do on your journey as an aspiring forex trader is to get educated. The internet is filled with free resources for traders, or you could choose to pay for a training course if you’d prefer. Keep in mind that many failed traders only gave up because they didn’t invest enough time into their education before they got started. Here are a few quick tips that can also help with this step:
- Start with forex terminology (leverage, spreads, bid/ask price, etc.)
- Try searching “forex basics”
- Learn about the mechanics of trading
- Research different strategies
- Take in information from a variety of sources
- Learn about the factors that affect prices in the market
Step #2: Develop Your Trading Plan
A trading plan takes several factors into consideration:
- The time you have to trade
- Your goals
- How much you’re willing to risk
- How you will find and execute trades
- The size of positions you will take
- Other rules for when and how you will trade
Step #3: Open a Trading Account
First, you’ll need to choose a good forex broker to trade with. Know that there are many trustworthy brokers out there but remember that scammers are out there as well. This is why it’s important to do research about a broker and to read through their terms & decisions before making a decision. You’ll also want to compare brokers to make sure you find the most attractive conditions available for the deposit you’re willing to make.
Step #4: Start Trading!
Once you’ve made it to this last step, you’re ready to begin trading. Be sure to analyze the markets before entering trades, while keeping your trading plan in mind. Some might prefer technical analysis over fundamental analysis and vice versa. Everyone trades differently, but your trading plan should help guide you when it comes to making trading decisions. If you have any trouble getting started, try looking online for tutorials. Video tutorials can be especially helpful.