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Beginners Forex Education Forex Basics

Forex Trading: Expectations vs. Reality – Part Two

Let’s be honest, we all came into trading thinking that we were going to be rich, that is simply the expectation that a lot of new traders come into trading thinking, they have seen all the advertising spells with the present but often hidden warnings about the number of people who lost money. Due to these adverts and people on social media, people feel that trading is easy and that they will make a lot of money very easily and very quickly Or there are those that know very little about it that see it as gambling or a risk to do. Both of these expectations come from what they see from the outside, yet when we get into the actual facts, things are very different in reality than they are in their expectations. We are going to be looking at some of the differences between the realities and expectations of trading.

The Work Involved

If you go onto social media you would get the impression that there isn’t really that much work to put in in order to make a bit of money, if you have watched a trading film, which is the only reference that a lot of people get, you will either think that there is an incredible amount of work or none at all. Either way, whatever your expectation is, it is probably wrong. Those coming into trading thinking that they won’t need to put on a lot of work will be in for a shock. There is in fact a lot of work involved. In fact, it can take a very long time to put on a single trade, if you want to be profitable then this won’t happen overnight. Instead, it will happen over months or even years for a lot of people. If you want to succeed then you need to ignore the idea that it is quick and easy and instead come to realize that you are going to have to put in a lot of time and effort.

Is It Gambling?

From the outside, forex trading can look like a bit of a gamble, let’s be honest, the markets will either go up or they will go down which makes it a 50/50 chance right? Pretty easy to guess then, well not exactly. The markets are influenced by hundreds of different things, each pulling the market in one direction or another, it is up to you to work out which way it will go. You cannot however simply guess, if you do that, you are pretty much guaranteed to lose overall. Instead, you are going to need to take your time to analyze all the different indications and influences of the markets. This will enable you to see which is the most likely direction that the markets will move in. This can then give you the best chance to trade correctly, so it certainly is not gambling. It is all about weighing up the different probabilities and then trading in the most likely direction.

Required Funds

Many people seem to be coming into trading thinking that they will be able to make a lot of money off a $100 account, this is simply not the case though. Much like with anything in life, you need money to make money, the larger your account is the more profits you will be able to make. Those adverts that are promising you that you will make $100,000 on a $100 account overnight are simply trying to scam you out of your money. If you want to make a lot then you will need to start with a lot. Otherwise, you will need to slowly build up your account over a longer period of time. If you have a $100 account then you can expect to make a few quid per week, not double it up every single week.

Winning Formula

There are hundreds of strategies out there, loads of variations of each one, so why some people come into trading looking for that magic formula that will make them profits all year round is very confusing. If there was one strategy that worked, then we would all be using it and all those other strategies simply would not exist. Not to mention the fact that if there was one strategy, the markets would simply cease to function, as everyone would be using the same strategy and putting on the same trades, meaning that the markets would come to a standstill. For this reason, there cannot be a single strategy that always works, instead, you need to learn a number of different ones in order to remain profitable all year round.

Is It Random?

The simple answer is no. The markets are far from random but they certainly look like it sometimes. From the outside it looks like they simply do what they want, moving up and down whenever they want for no apparent reason. When in reality there are a lot of different things that can cause them to be and to influence the way that it moves. Trader sentiment, news events, natural disasters, and economic data are just a few of the things that can influence it. When they do take effect, the directions and the effects can be predicted, however even though it can be predicted to a certain extent, it can also move out of sync, moving against what would be expected. This is why trading is not a guaranteed thing, while it can be predicted to an extent, it does have a very small essence of randomness to it, but not as much as it may look like from the outside.

Is It A Scam?

Another popular opinion amongst those that do not actually trade is that forex is basically a giant scam, it is full of people wanting to take your money and you can’t actually make any profits. The sad truth is that this is partly true, there are a lot of scammers out there, from traders, account managers, signal providers, and even brokers. There are ones that are there to simply take your money, but this is not what all of them are doing. There Are genuine people out there that are actively trying to help you to make money, there are some great brokers that are only there to help, signal providers offering genuine signals, you get the point. So while there are frauds out there there are also some great opportunities too.

Those are just a few of the expectations that we see people have and what is actually going on. There are some similarities in places, what we see is sometimes what we get, however, there are also a  lot of differences, once you actually get into trading you will come to find that there will be a lot of differences in what you experience compared to what you were thinking you were going to get.

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Beginners Forex Education Forex Basics

Forex Trading: Expectations vs. Reality – Part One

When you tell someone about trading and forex, what do you tell people? Most likely you are telling them all the best things about trading, these good reasons are the reason why you trade in the first place after all. These stories that you are telling other people are what is creating an expectation in them of what trading and forex actually are. If you look anywhere on the internet, there will be people talking about forex and how much you can make, how easy it is, and how life-changing it is, very rarely do you hear horror stories or the opposite feelings. This creates a certain expectation from people outside of the trading circle, expectations that do not really match up to the reality of what trading is and what it involves. We are going to be looking at what some of the realities are when compared to the expectations that a lot of people have and seeing whether the general expectation is right, or if reality is completely different.

It’s Incredibly Easy or Hard

When all you hear about is the fact that people are making a lot of money or that people are making some great returns then it would make it seem like trading is easy, thousands if not millions of people are making money doing it, this is true, but they are putting in a lot of effort in order to get to that level, they did not simply sign up and then place trades in order to be successful, a lot of work needs to be put in. On the other hand, looking from the outside, it can look like it is incredibly complicated, with numbers all over the place, charts, indicators, and more. It can seem very complicated which would make it seem hard to do. When in reality, it is quite straightforward, it does take time and work, but it is nowhere near as complicated, most indicators are self-explanatory and when you actually start using them, they make a lot of sense.

You Need A Lot of Money

If you have watched any trading films, it would make it seem like you would need a couple hundred thousand to trade properly, and to be honest, this would be true if you went for a 1:1 leverage account. The thing is that a lot of brokers these days are offering far higher leverage. In fact, some go as high as 2000:1 which is a little extreme, but even the popular 500:1 makes it so that trading is far more accessible to the average person. Many brokers allow you to sign up with a minimum deposit of $10, which will allow you to trade, you would need a couple hundred to trade properly, still a far cry from the hundreds of thousand that you otherwise may have thought you would have needed.

Forex Is A Scam

When something seems too good to be true, then most people would consider it a scam, and many people see forex as too good to be true, a way of making money by sitting at home in your underwear. It is Perfectly understandable why people think that trading is a scam, but in reality, it is not. Yes, there are people who try to scam newcomers into trading or to take advantage of what they believe, making quick profits, but trading in itself is not a scam. It really is a way to make money at home, even in your underwear, but it takes time and effort, so don’t believe the huge and instant returns that are promised and work on your own trading. Oh, and you should also keep an eye out for those dodgy brokers, but choose a good one and you should be fine.

It’s All the Same

From the outside, all the different currency pairs look pretty much the same, the charts look pretty similar and they all work the same way. Fortunately, that is not the case, in fact, every single currency pair acts completely differently, they have different levels of liquidity, different levels of volatility and offer a new trading experience when compared to another. For this reason, it is recommended that you learn a single currency at a time, then move on to a new one, if you start with a load you will be confused and make losses. With so many different currency pairs to choose from, it ensures that trading will always be interesting and there will always be new challenges to look for.

The Gambling Aspect

For some trading and forex simply looks like a gamble, there are only two outcomes, after all, the markets will either move up or they will move down. While technically true, there is a lot more behind it than simply that. There are thousands of different things that can influence the markets. News events, natural disasters, Donald Trump tweeting something, or just other traders thinking the markets will move a certain way. You need to take all of this into consideration, once it has been analyzed you can work out the most likely direction of the markets, it is not simply a 50/50 chance of it moving one way or another. Some people do of course come into it and gamble, but they very quickly learn that you cannot be successful by trading that way.

Managing your expectations is vital when it comes to trading, many people come into it with expectations that are far too high, thinking that they can make a lot of money overnight, this just won’t happen. If you have your expectations in the right place then you will be in a much better place to achieve your overall goals. Managing your expectations is vital for a successful trading career.

Those are some of the differences in the expectations that people have compared to the realities of trading. From the outside forex looks like a very different beast than it is from the inside. You don’t really know what is involved until you are in it and when you are, your expectations will be quickly broken as you realize what it is really about.

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Beginners Forex Education Forex Basics

Top 10 Things I Wish I’d Known Earlier About Forex

Hindsight is a fantastic thing for those of us that have been trading for a long time. We made a lot of mistakes or didn’t do things quite the right way when we started out, things that we wish we had known or done differently. For those just starting now, you can take advantage of the fact that we have learned a lot of new things about our trading and the things that we can do, meaning that you can start off where we are now, rather than at the very start of a trading journey. So here are ten things that we wish we had known earlier in our trading career.

1. No single best time to trade: When I started out trading, I was told that there are certain times during the day that you need to trade at, and should pretty much avoid the rest, this is simply not the case Yes there are times where there is a lot more liquidity and movements in the markets, such as during the changeover of the different markets (London and New York for example). This does not, however, mean that this is the only time that you are able to trade, but this is what we thought, of course, we don’t mean that we weren’t able to, just that it would not be as beneficial for our strategy, now, however, we know that we can trade at pretty much anytime and it can be effective, bar some special circumstances or random news events.

2. The majority of traders lose money: If you are just coming into trading now then you probably already knew this, but a number of years ago, forex brokers did not have to have the disclaimer about the majority of traders losing money as they do now. In fact, they purposely hid it, which is why the requirement came into lace. Due to this, we believe that everyone could make a lot of money, but we now have the understanding that it is a hard thing to do, and this makes us more cautious and careful with the trades that we make.

3. Some currencies are linked: A number of the currency pairs and different assets are linked together, think about oil and CAD for instance, when the oil prices change, so does the CAD currency. Knowing which assets work with each other can give you a real advantage when it comes to knowing how the markets will move and how certain things like news events will affect other currencies, ones that say not necessarily be involved in the news.

4. You can profit with more losses than wins: Losses are a part of trading, in fact, it is something that all of us will experience and experience a lot of them. What we did not understand before is that you are actually able to be profitable by winning only a fraction of your overall trades. Our current strategy means that we only need to win 25% of our trades, something that is certainly achievable. Get your risk management and risk to reward ratio right and you can profit with just a small number of wins overall.

5. You can lose with more winners than losers: The other side to the coin mentioned above is the fact that you can actually lose money, even if you win 80% of your trades, if you do not use proper risk management techniques, then even if you have a number of winning trades, when you have a losing one, without the proper things in place, that one losing one could take away all of your profits and leave you out of pocket. This shows us how you need to get your risk management right, no matter the strategy that you are using.

6. Big news can be bad news: News events can be a little scary, yet we were not told this when we first started. Instead, we just traded whenever, with little regard to what news events were going on around us. This is where we went wrong, we wish we knew about the effects that news events can have on the markets, we have been trading through them and seeing ht markets jump massively up or down which has caused us both large wins, but also large losses, far more losses. So now we know not to trade during the news events, which has saved us a lot of money.

7. Don’t quit your job: Not something we actually did, at least not to begin with, but quitting your job was the goal of a lot of people, and we were told that it is certainly possible due to this, a large number of people took the leap a little too early. Unless you are really ready for it, with a lot of time and work behind you, then you will not be ready, no matter how well you are doing, you are not ready to quit your job unless you have been successful for at least a year in a row and are making more than you do with your job, only then should you do it. We weren’t told this before, and many learned it the hard way.

8. It can be good not to trade: A quick one at this, but you don’t actually need to trade. If the conditions aren’t right, then there is no need to actually put on any trades. It can be best to sit back and be patient. Better opportunities will come up and if the markets are not in line with your entry requirements, then putting on a trade would be considered a bad trade, something that we want to avoid doing as much as we possibly can.

9. You don’t need loads of indicators: Indicators can be fantastic, they can show you a whole host of information, but do you really need all of it? If you have too many indicators it can actually slow down your trading, each one that you add is another bit of information that you need to check before putting on a trade, the more you have, the more time that will take. Not to mention the fact that it could simply confuse you seeing so much information on the screen. Instead, choose just a few, this will enable you to get the info you need while still streamlining your trading and making it much quicker. Oh, and make sure they are at least relevant to your strategy and not just simply random indicators because they look cool.

10. Forex is long term: We came into trading like many others did, with the idea that we can make a lot of money and make it very quickly, we now know that this is north e case and instead Forex and trading are long term things where we can build for our future. Trying to make a lot quickly will only cause you to lose your deposited capital, so take your time and slowly build your balance rather than going for the big bucks.

Those are 10 of the things that we wish we had known when starting out our trading carers. You probably know most of them already as the information is much more accessible and people have been through the same experiences as us and shared them online. There will of course be learning opportunities and things that you will develop that you wished you knew before, but ultimately that is life and will happen with everything that we do.

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Forex Basics

What Skeptics Need to Know About Forex

There are a lot of people out there that simply do not trust trading or forex, they see it as some sort of money sink that will only result in losses. #If you go onto any sort of social media, you will always get a few people shouting about how bad trading is and that trading as a whole is a scam, maybe they lost some money, maybe they just don’t understand it, either way, it is important that we get all the information before we decide whether something is good or bad. So we are going to be looking at some of the things that the skeptics of forex trading need to know which may just change their minds about it.

Forex Is Real

One thing that you see some skeptics saying is that forex is simply not real, you are not trading with other people, you are trading against the brokers and they control the numbers, not the markets themselves. Well, the thing is that with some brokers this is partly true, for market maker brokers, you are actually trading against the broker and so it is in their interest for you to lose. With many other brokers like STP or ECN brokers, you are actually trading directly on the markets and it is in the interest of the brokers that you do well as they make their money through commissions. When trading with these brokers the markets are very much real, all money being traded are from real people or institutes. Forex is very much real and you can certainly make money out of it if you trade well.

Not Everything Is A Scam

There are a lot of scams out there and if you have been a victim of one, you will most likely lose a lot if not all of your trust in the forex industry. That is perfectly understandable, but not everything is a scam. There are a lot of legitimate brokers out there that are to help you trade, they do everything by the book and can be trusted. Many peoples view of forex is what they see people posting on social media, which is full of exaggerated results, exaggerated claims, and exaggerated promises, not the best place to get any real information, Instead if you go to one of the many dedicated trading sites or communities then you will see the truth, you will see the losers, but you will also see the honest winners, those making money and those showing that trading and forex are not actually scams.

You Can Earn Money

You can certainly make money, this goes along the lines of everything being a scam again, may skeptics who do not believe that you can make money also believe that it is a scam. Yet you can certainly make money, a lot of people do and a lot of people will continue to do so. We have made money ourselves, we know people making a regular income with trading, it is certainly possible, but until the skeptics actually make something they will not believe it, and even then, some will find it hard to actually believe.

Information Is Plentiful

A lot of people are skeptical about things because they simply do not know a lot about whatever it is that they are skeptical about. The good thing about forex and trading as a whole is that there are tonnes of information out there, so much so that you can go to any sort of trading-related site and find out quite a lot about it. There are also a  lot of trading communities around which can give you a great insight into how traders actually think as well as how they are doing with their trading. If someone is skeptical about trading because they do not know much about it it will be easy to help educate them on what trading is with all the information that is available on the web.

It Is NOT Gambling

Front the outside, when you do not know a lot about reading, it can look very much like gambling, we say this simply because, in the end, you are putting money on and then hoping that the markets go the right way, at least that is how it looks. In reality, there is a lot more to it than that, we do a lot of analysis in order to look at the different probabilities and then buy or sell based on those probabilities, so there should be a higher chance of our trades being successful than not. From the outside, they do not see that, they just see the trade and the result. There is an element of gambling, as the markets won’t always go the way they are meant to or we expect them to, but we certainly would not class trading or forex as gambling.

You Are Right

A strange one, but you should be telling skeptics that they are right, they are right to be cautious, they are right to have doubts, and they are right to be interested., You cannot be a skeptic if you do not have any interest in the subject. They are right to doubt simply because a lot of what you see makes things sound too good to be true, some bits are, but some bits are very real. It is always good to question things but you also need to be open to the answers, especially as some of them will go against what it is that you believe.

So those are just some of the things that the skeptics of trading and forex should know about, there is so much out there that can make some doubt, but also just as much out there that should make someone believe, it is all down to which bits of information they are exposed to first as to which opinion they initially build. We need to ensure that those that do not believe are shown the right info to help convert them, but you should not waste your time trying to convince someone who does not believe, instead you should be spending your time and energy on improving your own trading and aiming to be more successful as a trader.

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Forex Basics

Top 10 Fun Facts About Forex Trading

When it comes to forex and trading, there is loads of information out there, it also has a very rich history, so when we think about it, there are thousands of facts that could be spoken about trading. Today we are going to be looking at some of the fun facts about trading that you may not really know about. Of course, some are very common knowledge, others will be a little more on the subtle side with fewer people, and some may simply be surprising. So let’s take a look at some of the facts about trading.

It’s Been Around for Centuries

Forex and currency exchange has been around for centuries, of course, it never used to be about trading actual currencies. These days we are trading the GBP with the USD, back then we may have been trading some corn for a sheep. Even in biblical times, the Talmud actually records foreign currency exchanges back in biblical times. They record how moneychangers would set up various stalls where they would then change currencies for another while taking a commission for the change. These sorts of exchanges have also been recorded within ancient Egyptian papyri which date back as far as 260 BC.

The Cable

You may know that the GBP/USD currency is known as “the cable”, but do you know why it is called that? It is known as the cable due to the fact that before we had satellite and fiber optic internet, the information used to be passed between the London and New York exchanges with a giant steel cable that passed under the Atlantic ocean and was used to synchronize the rate between different currencies between the two stock exchanges. While it is no longer needed, it still has some use in modern times, but it is no longer used for the synchronization of data as this can be done quickly through more modern means such as fiber and satellite.

The Worst Currency Inflation

You have probably read about it or seen in the news or even social media sites, that the currency inflation rates in Zimbabwe went through the roof, which is out of sync with the rest of the world which often has very subtle movements in the inflation rates. The country experienced one of the worst inflation in record history where the inflation rate went up 6.56 sextillion percent, to put that into perspective, that is over 6,000,000,000,000,000,000,000%, a number that many probably didn’t even know existed. Due to this, Zimbabwe had to completely wipe out the currency and get rid of it, this happened in 2009 and up until 2014, it had to use foreign currencies as its main currency. During the high levels of inflation, the banks in Zimbabwe actually had to limit back withdrawals to Z$500,000 which equated to just $0.25 USD.

There Has Not Been A Collapse

Contrary to belief, there has not actually been a financial collapse that has affected the forex markets, it has caused a bit of movement but there has never been a collapse. Unlike the stock markets which have had a number of crises where the stock values have plummeted and people have lost thousands or even millions. When those same crises have occurred, the forex market managed to withstand it, this is mainly due to the fact that the markets are made up of traders and the prices rely on them, rather than companies and shareholders, this is why those collapses did not affect the forex markets as much and they can potentially withstand anything that happens.

Printing Money

An interesting fact about American banks, before the US Federal Reserve was established back in 1908, pretty much any bank was able to print their own money. The US Federal Reserve put a stop to this as it had the potential to cause mass inflation within the USD currency should the bank have decided to start printing.

Huge Amounts Are Traded

There is an absolutely huge amount of money traded within the forex markets each day, which is why it is the most liquid market in the world. There is an estimated $6.6 trillion being traded every single day. A number that will most likely never be topped apart from the forex markets themselves. No other market comes close and no other market probably ever will.

Challenged by Cryptocurrencies

The current market prices and trade volume of cryptocurrencies is nowhere near that of forex trading, but if there is going to be any sort of market that can actually challenge that of forex it will ultimately end up being the cryptocurrency markets. Currently, the transaction volume is in the tens of billions, far behind the forex markets, but there has been a substantial increase, and it is continuing to increase each year. It will take a long time, many, many years to get anywhere near the same level, but with the constant increase and exponential growth of the cryptocurrency world, there is certainly a chance that the forex markets will be challenged years down the line.

Forex Will Always Be Here

The markets will always be here in one form or another, even if traditional currencies are no longer available and no longer around, there will be some form of currency exchange. The World will never have a single currency, it just would not work due to the different ecosystems and the different natures of the various countries within it. So even if there are not traditional currencies, there will still be a need for the exchange of currencies whatever they are. Due to this, the foreign exchange market will always be there and so there will always be an opportunity to trade one way or another.

The US Market Is Not the Center

Many people, especially those that have seen some of the Hollywood or bigger films about trading and forex will often think that the USA is the center, it is where the most trading happens. When in reality, only around 19% of trades and trade volume takes place in the US, instead, the center of the trading world is actually London, it is predicted that 43% of all forex trading transactions take place in the United Kingdom, and London, making it the main hub for Forex trading.

Millions Required

Forex trading didn’t use to be as accessible as it is today, many years ago before the rise of retail trading brokers, in order to trade you would need to be an institute with a minimum of at least $40 million in order to trade, not something many individuals would be able to do. These days, you can trade for as low as $10 which makes it highly accessible for people all over the world and from pretty much any location that has an internet connection.

Those are some interesting facts about the forex markets, some you probably knew, others you may not have. The emirate is always changing, different things are always happening within them, but one thing is for sure, the markets will be around for a long time to come.

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Forex Basics

The Most Common Complaints About Forex, and Why They’re Completely Bunk

There are a lot of complaints when it comes to forex trading, and we mean a lot. Many of them are completely legitimate while others are based on a single opinion or something that someone may have experienced. Whatever the complaint is, there will surely be ways to get around it or to help out to prevent those things from happening again in the future. It is because of this that we are going to be looking at some of the most common complaints that we hear about forex and the reasons why those complaints probably should not be happening.

It’s Too Hard

Forex trading is not hard, complicated yes, but not hard. We say this even with the knowledge that the majority of people that trade will lose money. People seem to put the term hard on everything these days, forex is not hard, it just takes time, and that’s for some people what makes things hard. Yet in reality, it is not hard at all, all you are technically doing is placing a trade, choosing whether it goes up or down and that is it, it is incredibly easy and quick to do. Yet people refer to it as being hard because of the amount of time and effort that you need to put in in order to be good at it and in order to know which way you should be placing your trade. Yet it is still not hard, it just takes time, time does not make things hard, hard shoulders mean that it takes a lot of effort in order to do the thing that you are trying to do, and that is playing the trade, which we have already discussed, is actually very simple.

People simply do not want to put in the time that it takes in order to be a better trader, they just want to get on with it and that is a mistake. If you try to place trades blind you will make losses, those losses will of course make it harder to make profits, but again, that does not make trading hard, it simply means that you need to put in more time, not more effort.

It’s All A Scam

Forex trading is not a scam, if it was there wouldn’t be over a trillion dollars being traded every single day. Forex is basically just a way of exchanging foreign currencies for each other. It has been happening for hundreds of years in one form or another and will happen for hundreds more. Businesses are run off of it and if it was a scam, the majority of businesses that we have today would have disappeared a long time ago.

We have to admit that within the forex trading world there are a lot of scams, but these are from individuals, people who are setting out to try and take your money. These are the people offering ridiculous Reuters on your investments or certain brokers that have been set up to be predatory, trying to milk money out of you. It is important to know that those are individuals and not the industry as a whole. The industry is completely legitimate, you can do it yourself, go to a foreign exchange shop, buy some currency, hold it for a while, and trade it back, you are doing the same thing on the markets, just in a more convenient way and for more money. Fores is not a scam. It wouldn’t be here if it were, it is as simple as that.

It’s Not for Individuals

Many years ago this would be completely true, you used to need millions of dollars before you could even consider trading on the global forex markets, this made it so that only the biggest businesses and institutions could take part in the markets. These days though, this is certainly not the situation that we are in. These days anyone can trade, all that it takes is a computer or mobile phone, an internet connection, and a balance of as little as $10. That is all that you need to trade which is ridiculous and incredibly accessible. There are no more excuses available for it not being easy to get into. You can go from no account to your first trade being placed in the matter of about 10 minutes with some brokers. There are millions of people trading from their bedroom at home and things will only continue to get easier.

It Takes Too Long

We mentioned above when we discussed forex being hard that it takes time, this is true, but it certainly does not take too much time, if you are finding that it is, then that is something that you as an individual are doing wrong. Actual trading, placing trades, and the analysis for each individual trade does not take a lot of time, this can be done in a few minutes up to 30 minutes, which should be more than enough time to place a trade. What can take a while is the initial learning, but that does not mean that you need to do it all at once which for some reason is what a lot of people try to do. When you try and cram in all your learning into one session then yes, it will take a while and it will be boring. Instead spread it out, learn one thing a day, do not bog yourself down with books and reading for hours at a time. If you spread it out, it will still take the same amount of time in regard to actual learning, but it will be far less boring for you and don’t feel like such a chore or that it is taking up so much of your time.

Those were some of the more common complaints that we see about trading forex, as you can see, the majority of them are simply not true, in the past there may have been a little more relevance to a lot of them, but as things have progressed they are becoming less and less an issue, but they are still things that people like to complain about.

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Forex Basics

The Most Interesting Myths and Truths About Forex Trading

There are many myths about Forex that need to be left behind well in the past and here we will tell you exactly what these are because in reality there are many more myths than truths. In this article, we tell you everything! So let’s dive into the good, the bad, and the ugly. 

The myths about Forex that circulate in the network do damage to this type of investment. Currency speculation has always been, especially in recent years, the victim of false news and rumors. In order to succeed in speculating or investing with this trade, investors need to leave behind these myths that affect the image of Forex and its expectations.

Forex gives monthly returns or interest.

Another false myth. As in the equity market, the return generated by the person investing in this product depends on the movements of the currencies the investor buys. In other words, profitability only depends on the fluctuation of prices, something that also happens with other investments (raw materials or stock markets, for example).

Forex is a pyramid.

Forex is an electronically controlled market where all foreign exchange transactions are carried out worldwide. Its usefulness is incalculable for international trade since it is in this place where the currency needed to pay or collect money from import or export products is bought or sold.

Forex makes you rich in a few hours.

Another falsehood. While it is true that anyone can access this market and accumulate strong profits in a short period of time, to invest in Forex and accumulate profits it is recommended to form in markets. That is, it is advisable to take a course to invest in a stock. With this course, we will be able to strengthen the knowledge we have and, on the other hand, learn more about Forex techniques.

Giving up our job to invest in Forex.

Investing in Forex does not mean giving up our job. We can test trading as a part-time job, at least entry, but never leave other sources of income and always learning from investment or currency speculation and receiving continuous training.

The intermediaries only want to con you.

From a few illegal experiences, many people think that the brokers who allow us to speculate on Forex are scammers. We must be clear that there are corrupt companies, but they are a clear minority. Forex is the largest market in the world, which has existed for many years.

There are two fundamental points that show why intermediaries don’t want to rip you off:

-Current licensing and regulation make it impossible for intermediaries to commit fraudulent activities. If you have opened an account with an authorized broker, the current regulations will protect your capital.

-Brokers earn money with the buy or sell spread. That is, they do not need to steal the investor’s capital to make a profit.

On Forex, you bet.

Forex trading is speculative, but to a certain extent: it is not a casino. The strategies and tools in this market are like those in the stock market. Forex traders have different trades, but they don’t work randomly. If an operation is carried out as if in a casino, this is the responsibility of each investor only.

I can make profits whenever I want if the Forex market is open 24 hours a day.

Again, you will not be sitting in front of your computer throughout the day to be able to operate for 24-hours. I would need automated trading software to take advantage of the 24-hour trading market.

I need to accurately predict the outcome of the market to succeed in Forex.

Unfortunately, there is no scientific method for us to have the knowledge of what is going to happen in advance on the market with 100% certainty. There would be no foreign exchange market if the exact exchange rates could be known in advance. Trading will never be an activity of certainties, but of probabilities. New traders tend to think in terms of odds, and this is one of the first things they learn and risk-reward relationships.

Many times you tend to think that you need to use an extremely complex strategy in order to succeed in Forex trading. It’s a popular myth that many online marketers want to create. The main requirement for success in Forex is self-discipline and money management. There are many traders who make profits consistently with simpler and older strategies.

A large amount of initial capital is required for Forex earnings.

A large capital investment will not help you with Forex. You don’t need much money to diversify into currencies and you can’t move exchange rates with your orders (you would need billions of dollars to do that). You can actually trade in forex with very little capital because forex trades are almost always leveraged with the money of the broker.

It’s a risky market.

One could say that it is a market with a lot of risks. The ability to leverage, or buy up to 100 times as much money as you have for investment and high volatility, or the sheer speed with which prices change every minute, can mean big losses to the investor.

The advice for those who decide to enter this market is to know the market before entering it, look for a broker’s platform, if someone will advise you to look well at the experience and set and respect the limits of loss per operation, by day, by week and by month.

Is completely legal.

Although it is not regulated, anyone can legally access Forex through a simple mechanism, looking for a broker. The recommendation, in this case, is to invest in a recognized broker, with trajectory, and use the formal channels to deposit the money to the account in which you will trade.

There Is No need to fear the Forex market.

Once we have established that it is possible to predict the market, why are there so many traders who, understanding and agreeing with this point, have trouble exploiting the market profitably? It is here that psychology is most useful. The trader should not be scared or afraid of not being able to win the market, as the market is changing, nor should he fall into despair because the trade he is waiting for right now seems unworkable, etc. The list of psychological problems that can be identified is quite long, and almost everyone identifies with fear or fear.

“Don’t be afraid of financial markets, just respect.”

The experience and knowledge of how they work will gradually turn us into traders with better mental control and more prepared to face any eventuality in our operation with total normality.

You can earn a lot, YES, but can you lose a lot? YES.

For example, if you open a new account with $10,000 in a broker that allows you to buy currency for 30 times more than you have in your account. Now buy 200.000 euros at a price of US$1.20 per euro, which is investing in total is US$240,000.

In this situation two possible scenarios may occur:

  1. The price of the euro grows to US$1.30. In that scenario, it would earn US$10,000, because it obtained a profit of US$0.1 for each euro it bought.
  2. The price of the euro drops to US$1.15. This is the side of history that no investor likes, but that usually happens to starters. In this scenario, I’d lose $5,000. And if you do this several times in the day, trying to make up for what you lost, chances are your account will be zero at the end.

The scenario that is illustrated, is something that usually happens on a daily basis in the Forex market. Then we already know the importance of learning and knowing how to choose an appropriate strategy to limit losses once a trade has taken place.

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Forex Basics

10 Incredibly Surprising Stats About Forex Trading

Both aspiring and expert forex traders can benefit from learning informative statistics about the forex market; however, you’ll often find a long list of boring facts and numbers when you look up the subject. We wanted our readers to have the chance to learn something new without feeling bored, so we scoured the internet to find the most surprising stats about the forex market out there. 

Statistic #1: Only 10% of forex traders succeed

Our first statistic is both depressing and surprising, but the good news is that it isn’t difficult to avoid becoming one of the failed traders we’re speaking of. The majority of this percentage is made up of aspiring traders that either opened a trading account without proper education or with unrealistic expectations. The misconception that forex trading is just a quick way to get rich draws in traders, then they give up quickly when they realize that they may have unrealistic expectations. 

Statistic #2: 51.6% of traders prefer Android smartphones over iPhones

People across the world have been arguing over whether Android or iPhone is better for more than a decade. We’ve heard a lot of arguments supporting the iPhone for all of its unique features; however, iPhone users might be surprised to hear that Android not only sells more phones than Apple, but the smartphone brand is also preferred by forex traders by approximately 14.3%. 

Statistic #3: A Whopping 90% of successful forex traders claim to use expert advisors

An expert advisor is a trading robot that executes trades on behalf of the trader. There are a lot of different types of EAs out there that enter and exit trades based on different principles. Although there are highly profitable trading robot options out there, many traders can be apprehensive about using them because they may fail and also because many EAs cost at least a few hundred dollars, meaning that you’ll be out of a decent chunk of money if you invest in an unprofitable robot. This is why it’s surprising to hear that so many successful traders actually depend on these services. 

Statistic #4: 27% of forex traders are aged between 18 to 32 years old

When you picture a forex trader, your mind might think of someone in their forties or fifties, or maybe even older. However, forex traders are getting started at much younger ages these days. Another 28% of forex traders are between 35 to 44 years old, meaning that younger traders make up more than half of the total forex traders in the world.  

Statistic #5: More than $5 trillion is traded in the forex market each day

It’s surprising enough to hear that an almost unheard of amount of money passes through the forex market every single day, but did you know that forex trading has more money flow through it than the stock market? It can be harder to find exact figures, but price points seem to fall more in the range of billions when you’re looking at the stock market, which gives forex a substantial lead. 

Statistic #6: 41% of all forex transactions occur in the United Kingdom

The most popular currency pair is the United States Dollar, so you might be shocked to learn that almost half of all forex transactions actually occur in the United Kingdom. If you’re wondering how many transactions take place in the United States, the answer is only about 19%. 

Statistic #7: Only 7% of traders have 10 or more years of experience

If you’re feeling like you’re at a disadvantage because you have little experience trading forex, you might be surprised to hear that traders with 1-3 years of experience make up 39% of forex traders, while another 31% have less than one year’s worth of experience. 

Statistic #8: 40% of forex traders choose to trade because they want to be their own boss

The number one reason why people decide to trade comes down to being their own boss, with almost half of all traders claiming this to be their top motivation, even more so than simply making money. Of course, forex does offer a lot of perks that you can’t find with a regular job.

Statistic #9: More than 45% of traders don’t spend money on learning resources

When you become a trader, you can find a lot of resources online for free, but some may believe that the resources you pay for would offer better educational opportunities. This isn’t necessarily the case, as nearly half of all forex traders opted not to pay a cent for any learning resources in the past year. 

Statistic #10: Approximately 89.1% of forex traders are men

You might have assumed that the number of male traders outweighs the number of female traders, but it’s surprising to hear just how much larger that percentage is. Of course, this is a great incentive for aspiring female traders to get out there and even out those stereotypes. 

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Forex Basics

You Need to Know These True Pros and Cons of Trading Forex

If you’ve ever considered becoming a forex trader, you have undoubtedly wondered if it would be a lucrative investment. Forex trading has helped many traders to amass a great deal of wealth, while it has caused others to wipe out their investments altogether. There are good and bad aspects to trading and considering those factors is important before deciding if trading is something that you should try.

Below, we will start positive with the plus sides of opening a trading account, before moving on to the cons.  

Pros

Flexibility

 Forex traders never have to worry about a stressful boss standing over their shoulder. They get to be their own boss, set their own hours, and work from anywhere with an internet connection. There’s no need to commute to work or even to change out of your pajamas if you don’t want to. You could work from anywhere in the world because traveling is no issue. This is one of the main reasons that many people dream about ditching their desk job to become a forex trader.

You can get a free education

Learning everything you need to be a successful forex trader is right at your fingertips, online for free. The internet is filled with articles, videos, and other resources that can be accessed free of charge. It’s true that this will take some effort on your part, but anyone can accomplish this with a little hard work and determination. Remember that investing time into your forex education is one of the most important things you can do before you get started trading. 

Leverage

Forex traders use leverage to increase the size of their trades. This gives traders with a smaller amount of capital the opportunity to make bigger profits. This is another one of forex trading’s main draws. 

It doesn’t take much to get started

You don’t need much to become a forex trader. Simply sign up with a broker from any device with a working internet connection, make a deposit, and you’re ready! Of course, you’ll want to be well-educated before you start, but even acquiring an education is free. Anyone that puts their mind to it can do this – it doesn’t require having a lot of money already or other difficult steps. 

Cons

You need a starting investment

Just to be clear – you can get started with as little as $5, but this isn’t going to leave much room for trading. Those who can afford to deposit a few thousand (or more) dollars are going to make more significant profits. If you’re just looking to make a little extra cash here and there that shouldn’t be a problem, but those that want to support themselves purely by forex trading need to have a larger investment to start with. Sadly, most of us don’t have $20,000 or in disposable income just so sitting in our bank accounts. This means that it will take a while to work up to making larger profits. 

Trading is risky

Trading involves investing your hard-earned money with no promises that you’re going to see any profits. Or even worse, you could lose it all. In a way, it involves the emotions one would feel with gambling, that trading decisions are less based on chance. Traders consider a variety of factors, like technical or fundamental analysis, which makes their decisions more founded. Still, at the end of the day, nobody can 100% predict the way the market is going to go. 

Leverage

We know that we listed leverage under the pros, but it can also be a con. Many beginners make the mistake of trading with too high of a leverage, which can quickly end your career. Leverage is often referred to as a double-edged sword because it can go both ways. If you’re a beginner, you don’t need to use the highest leverage your broker has available just because you can. Start small and work your way up, or leverage could be your downfall. 

Scammers

Scammers can be avoided if one knows what to look for, but many beginners do fall victim to shady brokerages. Whenever you’re looking at companies, check for regulation, and do further research before you give out any personal information or open an account. Some brokers have impossible withdrawal conditions, have customer support teams that you can rarely get ahold of, and so on. New brokers pop up every single day and only some of those options are legitimate. Choosing a forex broker is not a quick decision, choosing the right one takes thought and comparison.

The Bottom Line

Anyone that is interested can become a forex trader with some know-how and a small investment, but one really needs to consider the pros and cons first. You might make a lot of money, or you could lose everything you invest. The good news is that some of the downsides can be avoided. If you secure a good forex education, research your brokerage before opening an account, use a leverage that suits your skill level, and take risk-management steps, then you’ll be more likely to succeed.

The ultimate downside to Forex trading is the risk involved. Even if you’ve been practicing on a demo account, switching to a live account can feel overwhelming and you might not realize the way that your emotions, slippage, or other live conditions could affect you. If you are willing to put in the work to learn, then we fully recommend opening a trading account, just be sure that you’re investing from your disposable income, not from the money you need to live on or support your family. It can also help to adjust your expectations if you’re starting with a small investment.

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Forex Basics

Forex Myths that Some People Actually Think are True

As we’ve moved into the 21st century, forex trading has risen in popularity and attracted a growing number of traders from all over the globe. Although we would expect people to have a better understanding of forex thanks to the increased awareness, there’s actually a lot of confusion and several myths surrounding the subject. It can be difficult for new traders to decipher what is and isn’t true, considering that some of these myths are passed around as common knowledge and repeated often. Some of these false beliefs can even cost you to lose money! Below, we will debunk some of the most common myths you’ll hear about trading and shed light on any real facts that inspired them.

Myth #1: Trading is Only for Rich People

We’re more than happy to announce that this statement is actually the opposite of the truth. In fact, many brokers offer trading accounts that can be opened for less than $100. In some cases, brokers will allow you to open an account with $10 or less. So where did the myth that trading was strictly reserved for the rich come from? Those that can afford to make larger deposits can usually open better account types through brokers and there is potential to make more money when you have more money to invest. People also tend to assume that rich people have more resources available to learn to trade, as they can afford to attend college courses or pay for account managers, financial advisors, and training. In reality, you don’t have to have any of these things and everything you need to know can be learned online for free. 

Myth #2: The Risk isn’t Worth it

Just like with any other investment, forex trading does carry a level of risk with no guarantee that you’ll make money. Many people have done so and gave up in the beginning, which likely contributes to the popularity of this rumor. In reality, trading offers a much more structured way to make money because you aren’t blindly rolling the dice and hoping for a win. Your trading decisions are based on real evidence and you can control the amount of money you’re risking on every trade by practicing effective risk management. Keep in mind that your knowledge of the markets and your trading plan also have a big effect on the results you’ll see and that many of the people who say trading isn’t worth it didn’t understand the markets fully or they went in risking way too much money from the start.

Myth #3: Trading More is Better

The concept that entering more trades would give you the opportunity to make more profits seems simple, but this isn’t the way it really works. If you overtrade your account, you run the risk of an overactive account, which is harder to keep up with. You could then become stressed out or anxious and begin making mistakes or forgetting to exit trades. Traders that use too many indicators on their charts often suffer from this problem as well. Keep in mind that some strategies do require trading more, but you should never take on more than you can actively manage. 

Myth #4: Trading is Easy

Brokers have made it extremely easy to sign up for a trading account these days by only asking for a few personal details (like name, email, phone number, address, and country of residence) alongside low deposit requirements. If you want to open a trading account, you can literally do so in minutes. Unfortunately, the simplicity we mentioned leads many beginners to think that trading must be easy since it’s so easy to get started. In reality, you need to invest a lot of time and knowledge into researching various trading topics in order to be truly ready. It’s true that trading is something that most people can do successfully if they invest the proper time and effort into it, but many people believe the misconception that it is a quick and easy way to get rich and aren’t willing to put in the effort needed, so they lose their money and abandon their trading accounts. 

Myth #5: The Forex Market is Rigged Against Traders

Some people believe that you can’t make money trading forex because big banks and governments rig the market, or that brokers change and influence data to make you lose. In reality, the value of a currency is influenced by entities like banks and governments, but this is caused by inflation rates, interest rates, unemployment rates, elections, and other matters that just happen to affect the market. It isn’t actually possible for brokers to rig the market against traders either, as the forex market is too volatile and liquid to be rigged. In some cases, traders lose money at their own fault and want to blame their broker or say that the market is rigged to help their ego, even though this isn’t the case. 

Myth #6: You Need to Constantly Watch the Market

You don’t have to sit around in front of your computer screen 24/7 to be a successful forex trader. In fact, many people manage to work full-time jobs while trading on the side. You do need to spend some time looking at charts and analyzing data, but there are tools out there that can do this for you. For example, you could sign up to receive signals from a trusted signal provider in order to receive messages that tell you when you should enter a trade. Expert Advisors that trade for you are another shortcut that significantly reduces the amount of time you have to spend online looking at data.  

Myth #7: Forex Trading is Just a Big Scam

The idea of trading is scary to some because it involves making an investment through a broker and withdrawing profits later on. They imagine that the broker might keep their funds and refuse to issue their withdrawals for made-up reasons or that they might never respond to them again once funds are requested. It’s true that there are some brokers out there that are scammers, but you can avoid these shady companies altogether by doing research on any company you’re considering and sticking with more popular options that have received online reviews from real traders. It also might help you to rest easy by knowing that many of these brokers are regulated by government agencies that hold them accountable and ensure that traders don’t have to deal with shady tactics.

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Forex Basics

The Top 7 Most Misunderstood Facts About Forex Trading

Despite the fact that there are currently more than 9.6 million forex traders in the world, the topic of forex trading still manages to bring up many myths and misconceptions. Knowing the truth about some of the most common misconceptions out there can really save you money in the long run if you’re a trader. On the other hand, those that have only considered trading may have chosen not to open a trading account over a simple rumor, while others may jump in with unrealistic expectations. If you want to learn the truth about forex trading, keep reading as we break down the 7 most common misunderstandings about forex trading. 

Misunderstanding #1: Forex is a quick way to get rich.

We can thank several movies, brokers, and sketchy “motivational” forex traders for the misunderstanding that forex trading can make you rich overnight. Oftentimes, people see flashy advertisements that show traders living a luxurious lifestyle and they decide they want that for themselves. In reality, these are just advertising gimmicks meant to capture your attention and draw you in so that the trader can sell you something or to convince you to open an account with a broker. On the bright side, you really can make a lot of money trading forex, but the amount depends on experience, the amount you invest, the market environment, and other factors. If you start trading with a few hundred dollars in your account and little knowledge of the market, it will take a while for you to reach the larger monetary goals you’ve set. 

Misunderstanding #2: Trading is a scam.

While some traders believe forex is a way to get rich quick, others think that the system is rigged and don’t believe you can really make money doing it. Shady unregulated brokers contribute a lot to this misunderstanding, but you also might hear from scorned traders that lost money due to their own error. Those traders then turn around and blame their broker, the market, or something else to help ease their bruised ego, when they probably just weren’t prepared to open their first trading account. As long as you choose a trustworthy broker that is regulated with positive client feedback, you shouldn’t have to worry about any issues. It’s also important to know that there are too many factors affecting the forex market and things move too quickly for there to be any way for your broker to rig the market. 

Misunderstanding #3: More complex strategies are better.

Many traders believe that the more complicated a trading strategy is, the better the results will be. It’s actually fine to stick with a simpler strategy, you just need to take certain matters into account, like price movement, a ranging or trending market, reversal points, and so on. If your trading system is making profits but it isn’t as much as you’d like, start by considering these factors before adding more variables and overcomplicating things. Know that even the best traders usually walk away with only a slightly higher win rate than their loss rate, so you shouldn’t throw an entire trading strategy out the window just because you feel you should be making profits more quickly.

Misunderstanding #4: More trades = more profits.

This is a common belief among forex traders because it makes sense that the more trades you enter, the more chances you would have to make money. The truth is that you can actually make the mistake of overtrading if you do this and you put yourself at more risk of losing money. If you open too many positions at once, you also may have trouble keeping up with everything and you could become overwhelmed, causing you to forget to exit positions and to make more careless decisions. Instead, you should only enter a trade if there is good supporting evidence to do so and be sure that you never open more trades than you can manage. Even if you’re left feeling unproductive, it’s better to avoid trading if there just aren’t any good opportunities in a day. 

Misunderstanding #5: It’s possible to have a 100%-win record.

If you ever hear a trader say that they’ve never lost money or made a mistake while trading, don’t believe them. With the forex market being so volatile, it just isn’t possible to make the right moves every single time, even if you’re an expert trader with a high win rate. It’s also impossible for signal providers or Expert Advisors to trade with 100% accuracy as well, so don’t fall for these false claims. When you do lose, you shouldn’t beat yourself up over it, as the solution is to keep calm and assess what went wrong. If there’s a problem with your strategy or you made a mistake, simply try to learn from it, make any needed changes, and move on.  

Misunderstanding #6: Trading with high leverage provides greater rewards.

There’s an old saying about forex trading that claims, “leverage is a double-edged sword”. This is absolutely true – the higher the leverage you use, the greater the potential for returns; however, it also increases your risk significantly. Many beginners rush out and decide to trade with the highest leverage available through their broker, which can be as high as 1:400, 1:500, or even 1:1000 in some cases. Beginners need to know that many professionals actually prefer the leverage ratio of 1:100 because it provides a good opportunity for investment without an insane financial risk. You’re still free to make your own decisions regarding leverage, just keep these facts in mind if you’re tempted to use a high degree of leverage.

Misunderstanding #7: It’s best to choose a broker that offers 100% bonuses.

Some brokers offer perks in the form of bonuses and promotions to traders that choose to sign up for an account with them. While it’s great to see deposit bonuses and other ways for traders to make extra money, it’s important that you don’t choose a broker solely because they offer this type of deal. There are usually strings attached when it comes to this, like minimum trade requirements before you can withdraw profits, the bonus being nullified if you make a withdrawal before fulfilling certain conditions, and so on. The broker might also offer bad trading conditions in general and use the bonus to draw in traders quickly and to keep you from looking into their terms further. This doesn’t mean that promotional opportunities can’t be a good thing, just that you need to do thorough research anytime this is offered. 

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Forex Basics

The Most Difficult Parts of Forex Trading (and How You Can Easily Overcome Them)

Forex trading is hard. Anyone says otherwise either got incredibly lucky or had the work done for them. Here, we’re going to take a look at the most difficult problems associated with FX trading, and tell you exactly how to overcome them.

The fact is that the majority of people who try to trade the forex markets end up losing the money that they put in, the majority of traders fail. Then there are those that have had a successful month, this doesn’t mean that the next month is going to be profitable, in fact for the majority it won’t be. Trading is not easy, but it is incredibly rewarding.

We are going to be looking at what different parts of trading the majority of traders find the hardest and potential ways that you can help yourself get through those checkpoints. You may not find them all difficult, too many find other things difficult that others find easy, that is the thing with trading, each and every individual will have a different experience. So let’s take a look at some of the things that people find difficult when trading.

Choosing the Right Trading System

There are a lot of trading systems out there, hundreds, in fact, some are very similar to each other, however, others are incredibly different, being able to find the right one for you can be a daunting task. Many traders when starting out will decide to jump between a number of different strategies trying to find what works for you, there is nothing wrong with this. However, doing it too much and not giving each strategy enough time will mean that you will pretty much never find the strategy that works for you. There are a lot of reasons why a strategy may not work for you, it may require more money than you have, it may require higher leverages than your account has, you need to make sure that it matches what you have, which can be quite hard to find.

The other issue that people often come across is the fact that the most publicised strategies are either quite dangerous ones like the martingale strategy or strategies that have been marketed by so-called trading gurus as a marketing tool in order to try and get more people to sign up for their course. You will want to try and filter out these kinds of strategies, as they are often quite easy to get into and learn, but the results will leave a lot to desire. Do some research and take your time when deciding on your strategy.

Controlling Emotions

Emotions can be a real killer when it comes to trading and they have caused a lot of people to blow their accounts. There are two main emotions that are the most important to try and control, there is greed and there is overconfidence. They often come from completely different things, greed from wanting more, and overconfidence from thinking that they know the markets and each decision that they make is simply right, whichever emotion you are feeling, you will want to try and suppress them and to not allow them to take over your trading.

This is of course much easier said than done, both of those emotions are incredibly powerful and can really affect your trading. Those that fall for greed will start to put on additional trades and larger, riskier trades than you would normally put on. People who are overconfident will start to put on trades without putting in the proper amount of analysis that your strategy normally demands, you may also start to put on larger trades which can add to the risk that your account is under. 

It is not an easy thing to control those emotions either, the powerful ones, but it is important that you work out some things that you can do in order to help you get past them. Knowing what coping methods work for you is important, it may be as simple as getting out of the house for a few minutes, doing some online shopping, or talking to someone, whatever works for you, be sure that you are able to do it should you feel any of these emotions start to come up, just do not let them influence your trading, that will only lead to increased risks and the potential loss of your account.

Staying Motivated After Losses

Losses are not great, they make us feel a little crap and a little demotivated, they can even make us want to quit entirely, especially if they come after a lot of preparatory work. We need to have a way to keep ourselves motivated though. All traders, and we mean all traders will experience losses. In fact, some of the most successful traders of all time had losing months at the start. They still probably do, but the reason that they are successful is that they were able to motivate themselves afterward in order to keep going. Each loss should be a learning experience, learn from what you did wrong, motivate yourself to try again with your new-found knowledge and the results should be better. You need to remember that while losses can make us feel bad, they are just a stepping stone to better trading, so do not feel disheartened and try and push yourself to move on, do not let the loss start to make you doubt or even worse, do not let the emotions take over your trading, this will add risk and potentially further losses.

Being Consistent

One of the hardest things to do in trading and forex is to be consistent, if we could all do it then we would all be rich by now. Many many traders have had a profitable month, which is great, but that is no guarantee that their next one or the one after that will be profitable and that is where things start to fall apart. Your strategy may work really well, but then when the condition of the market begins to change, your strategy may not be quite as effective as it was before. Without adapting it to the new market conditions, you will end up with a loss and your results and profitability will not be as consistent.

In order to remain consistent, you need to be able to adapt your strategy or to have multiple strategies available to you that you can jump between. That is however a lot of work and many people who have just had a profitable week or month will simply want to stick with that as it works, but as we discussed above, this will only lead to added risks when the markets do decide to change. Consistency is great. It just so happens to be one of the hardest things to be when it comes to forex and trading.

So those are some of the more difficult things when it comes to forex and trading, trading forex as a whole is pretty difficult, but if you are able to get around some of the things mentioned above then you will be in a good position for the future. Do not be hard on yourself if you fail at times, that is part of the learning process. Instead, use those losses and mistakes as a learning experience, that is what will allow you to get past them and to become a better trader.

Categories
Forex Basics

Don’t Let These Common Myths Keep You from Trading

There’s a lot of speculation out there when it comes to forex trading, especially coming from people that have never tried it before. Many of the myths you hear make trading sound like a bad investment. On the contrary, trading may not be for everyone, but it can be a good investment under the right circumstances. If you’ve been considering opening a trading account but you’re feeling a little worried, allow us to debunk some of the most common rumors you might have heard below. 

Myth #1: It’s a Scam

You might have heard stories online or even from close friends or family members that claim forex trading is a scam. The truth is that some industry regulations do make it possible for scammers to prey on those that don’t know a lot about trading, however, this gives the trustworthy brokers a bad reputation. There are many good brokers out there that are regulated by government agencies, meaning that they are held to a higher standard. It’s important to do thorough research before selecting a broker by checking out their regulation status and reading customer reviews online. As long as you go with a trustworthy, well-known company, you won’t have to worry about being scammed. 

Myth #2: It’s too Expensive

You might assume that it takes a lot of money to get into currency trading, however, many different brokers will allow you to start with as little as $10. From there, you aren’t obligated to continue making deposits to your account. Do know that some brokers ask for steeper deposits around $300 or more, or a broker might ask for a larger deposit for a certain account type that they offer. Still, trading can be inexpensive and there’s no reason why you can’t start small. Just know that the amount of your profits depends on what you invest, so don’t expect to make a living off of a $100 deposit. 

Myth #3: It’s Time Consuming

Some trading strategies do take more time than others, for example, a scalper might enter several (or hundreds) of trades per day, which obviously requires a lot of time in front of the computer. On the bright side, those that don’t have the time to invest can simply stick with a strategy that is less time-consuming, like swing trading, which involves opening a medium or larger trade and allowing it to accumulate for days or even weeks. 

Myth #4: It’s too Risky

It’s true that trading can be risky, however, there are many things you can do to make it safer for yourself. Starting out with a solid education and understanding of how trading works is one example, while only risking a certain amount on each trade is another good way to limit your risk. The amount you risk comes down to personal preference and can be changed later on, so there’s no reason to feel like you’re being forced to put more money on the line than you’d like to. 

Myth #5: Trading is too Complicated

If you jump right in and open a trading account without spending any time researching trading in general, then you’re likely to feel confused or overwhelmed. Fortunately, the internet is filled with free resources that will teach you everything you need to know. Some beginners just don’t want to spend the time learning, so they write trading off as being overly complicated and give up. As long as you’re willing to put in the effort, there’s no reason why you can’t use the internet to prepare yourself for a trading career. 

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Beginners Forex Education Forex Basics

Forex Misconceptions You Should Never Believe

Forex trading is shrouded in myths and misconceptions – some draw in traders, while others scare potential traders away for good. Unfortunately, it’s common for some traders to start out with unrealistic ideas of what trading really is, which causes them to give up once they realize that things aren’t the way they pictured. Keep reading so that you won’t be fooled by the following 3 misconceptions that surround forex trading.

Misconception #1: You Can Make an Easy Living from Trading 

You can in fact make a living from trading, but it isn’t nearly as easy as you might think. In fact, some people have actually quit their jobs because of this misconception, only to learn quickly that this idea is not entirely true. First, it would take a substantial investment in order to make enough money to support yourself from trading alone. The exact amount differs, but some studies suggest that it takes around $30,000 to wind up with $3K worth of profits each month. This might be equal to or more than your current salary, but many of us just don’t have that kind of cash available to invest.

You also have to consider that these studies expect the trader to really know what they’re doing, meaning that beginners aren’t likely to make as much money as an expert trader. In the end, it is possible to make a living from trading, but you’re going to need a sizable investment and experience to do so. It can take a few years (or more) to get there but do know that you can still earn profits from trading in the meantime. 

Misconception #2: The More Trades You Take, the Faster you Learn

Some newbies want to learn as fast as possible, so they assume that taking more trades will speed up the learning process. While more trading does lead to more experience, this mindset often leads to overtrading, which can cause you to lose money. Instead of trading too much, it’s better to try to improve the quality of the trades you do take. This can provide better immediate results and will improve your profits in the long run. Sticking to your trading plan, perfecting your strategy, and keeping track of results in a trading journal are the most helpful ways to improve your results as you gain experience.

Misconception #3: The Only Goal is Making Money

Everyone that trades wants to make a profit, otherwise, what’s the point? The truth is that making money is a common goal, but you’ll need to set realistic goals for yourself that extend beyond simply making money if you want to be a successful trader. The best goals focus on things that improve you as a trader and lead to better results in the long run, thus leaving you with more money in your pockets. Examples include sticking to your trading plan, tracking results in your trading journal, spending a certain amount of time each day researching, and so on.

You also want to stay away from goals that require you to make a specific amount of money in a certain amount of time, as the market is unpredictable and it is difficult to set realistic goals that go down to the dollar. If you focus on improving yourself and the trades you take, the end result will be more profits in your account.

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Beginners Forex Education Forex Basics

Were You Aware of These Benefits to Trading Forex?

Forex trading is often thought of as a gamble, as many potential investors are afraid that becoming a trader will lead to nothing but wasted time and money. While we’d agree that trading isn’t guaranteed to make you rich, there are actually several clear benefits to becoming a forex trader! Allow us to get straight to the point…

#1: Working on Your Own Clock

Perhaps one of forex trading’s biggest advantages is its flexibility. You can choose to be a day trader that religiously begins at the same time every day if you’d prefer, or you can choose to trade whenever because the market never sleeps. This is also something that can be more of a hobby in your free time that helps you make money, or it can become your full-time job. The great thing about being a full-time day trader is that you no longer have to worry about sick days, vacation time, being late to work, and other problems that affect people working regular jobs. It’s true that you might miss out on some opportunities if you don’t trade enough, but the beauty is that your work schedule is entirely up to you. If you want to take a sudden vacation, you can do that. If you need the day off for some reason, there’s no reason to stress. Finding a regular job that has this much flexibility is nearly impossible.

#2: No More Boss!

This one only applies to those that actually quit their jobs to become a full-time forex trader. Let’s be honest – most people just don’t like their boss. In a regular workplace, you have no choice but to allow your supervisor to bark orders at you and watch your every move if they’d like to, or else you’ll find yourself jobless in a hurry. Forex traders don’t have to worry about the pressures of having a boss to impress, because they are their own boss. They decide when to work, what time to work, what to wear, when and how long their breaks can be, and everything in between. At the end of the day, you get to decide if your performance was up to your own expectations, nobody else’s. 

#3: Everyone Can Do It

Trading forex isn’t something that is reserved for people who are already rich or born geniuses. The only things you need are a computer or other devices like a phone or tablet, an internet account, and an account with a broker. Experience isn’t even required to open a trading account; you only need to be at least 18 years old with a starting deposit that can be as low as $5. Sure, some intelligence will definitely help you to be more successful, but the good news is that the internet is filled with free resources that can help anyone learn to trade. If you want to become a trader, everything you need is practically at your fingertips. Think about how hard it would be to become a doctor, lawyer, astronaut – if you’re good at trading forex, then you can skip some of the stepping stones like getting a college education and years of required work experience and get straight to making money.  

#4: The Size of the Market

More than $4 trillion dollars are exchanged in the foreign market every single day, providing forex traders with plenty of opportunity for profitability. Across the world, traders are buying and selling currency pairs and other assets day and night, so you don’t have to worry about a lull in activity. Plus, knowing that many people have invested in forex trading is reassuring, as this can tell you that there is money to be made by trading. High liquidity also providers traders with more opportunities to buy and sell. 

#5: Transaction Costs are Low

Transaction costs are low…as long as you’re using a good broker. It doesn’t cost much to enter the market and most brokers will charge you low prices for trading. Oftentimes, these costs are built into the spread, which is the difference between the bid and ask price. There may be some other costs to look out for, like commission fees that would be charged when placing a trade. Still, most brokers will allow you to open an account with a small deposit and provide good conditions and low fees. 

#6: Leverage

One of the major advantages that set forex trading apart is the ability to use leverage. This is basically borrowed capital from your broker that allows you to make trades worth more than what you have available in your account. Leverage is expressed as a ratio that can range from levels like 1:5, 1:30, 1:100, 1:500, up to whatever leverage cap is offered by your broker. Do know that using leverage can be dangerous, and we wouldn’t recommend using a high option when you’re just getting started. Still, leverage will allow you to make larger trades, which can be a big plus when you don’t have a lot of funds to start with.

#7:  Innovative Technology

Forex trading is at the center of many recent technological advances that improve the process and make trading more convenient. Mobile apps, platform updates, trading robots, and technical indicators are some of the best examples of ways that technology is improving for forex traders specifically. Humans are always drawn to convenience, so the constantly developing updates and upgrades are an undeniable advantage that will continue to make the lives of traders across the world easier. 

#8: Free Stuff!

We’ve all heard the phrase “nothing in life is free”, but forex trading has proven that this phrase isn’t always true. Brokers are willing to provide free educational resources in order to build better, well-educated traders that will hopefully sign up for their services later down the road. You can also access free demo accounts that allow you to trade with pretend money. Then there are actually ways to earn cash. For example, a broker might offer a 50% deposit bonus, meaning that the broker would give you $50 in your trading account on top of a $100 deposit. Another example would be a demo contest, where traders can earn real prizes just from trading on a simulation account with no investment. Do know that there are rules that make sure you can’t just claim this free money and withdraw it – you actually have to use it for trading, and you can withdraw profits if you make them. However, anyone that is serious about trading should feel ecstatic about receiving free money in their trading account.

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Beginners Forex Education Forex Basics

Six Seriously Damaging Misconceptions About Forex Trading

Have you ever seen a flashy video, ad, or website where forex trading is promoted by a billionaire? The luxurious lifestyle of a successful forex trader isn’t always as luxurious as it’s made out to be. This isn’t to say that trading can’t make you a great deal of money or help you become rich because it can. Unfortunately, however, there are some misconceptions out there that throw many beginners in the wrong direction. If you start with unrealistic expectations, you are likely to feel disappointed.

Thinking You’ll Get Rich Quick

The amount of money you make depends on many factors: your trading knowledge, strategy, how much money you invest, the leverage you use, your broker’s fees, how often you trade, and so on. You should know that it does take time for your money to add up, especially if you’re starting out with a smaller investment. Think about how many people would take up trading if it were that easy to get rich. The truth is that many people just don’t want to dedicate the time and don’t have the patience to stick with it in the beginning before profits become significant.

That You Can Start Immediately

Some people might see one of those flashy ads we mentioned and make an immediate decision to open a trading account. There’s nothing wrong with feeling inspired, however, you certainly aren’t prepared to trade from a whim. You need to invest time into educating yourself about trading first, no matter how eager you are to get started.

That it’s Better to Risk More

When one is gambling, they might make the decision to risk more because it can lead to a larger gain. Of course, you can also suffer a big loss. Forex trading and gambling are similar in this respect, but it’s better to risk less when you’re trading. Although you will base your trades on something, like fundamental or technical analysis, the market is still unpredictable. If you risk less, you might not earn as much, but you will also avoid wiping out your account. 

The More Leverage the Better

Different brokers offer different leverage caps. Some regulators restrict the cap to 1:30, while others offer much more flexible leverage options of 1:300 and higher, even up to 1:1000 or more. Since leverage increases your buying power, it’s a common misconception that more leverage is better. On the contrary, leverage can actually cause significant losses, especially for beginners that don’t have much experience. Stick with lower options unless you’re a seasoned trader that has a lot of money to gamble with.

That Trading is Fun

To be honest, trading can be quite boring. Many hours are spent in front of a screen waiting for a good move, and you may have days where you barely do anything at all. You might have a misconception about the life of a forex trader from movies that depict the fast-paced action on Wall Street, but this just isn’t the case for traders working from home. On the bright side, trading does offer some advantages, like the ability to work from anywhere with an internet connection. 

That you Need a Lot of Money to Get Started

Some might think that trading forex is not within their reach because they just don’t have a lot of money to invest. It’s true that the more you invest, the more you can make, but this doesn’t mean that you can’t get started with a small amount of money. Many brokers even offer special accounts that will allow you to get started with $5 or so. This misconception doesn’t end trading careers, it stops them before they start. Never be ashamed to invest in your future, even if your first investment is only a few dollars.

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Beginners Forex Education Forex Basics

Some Uncomfortable (and Painful) Truths About FX Trading

When it comes to trading, there are a lot of ideas and rumors flying about which are coming from both those that have traded for a long time, those that are just starting out and those that do not trade at all. Some of what you hear is about what it is like to trade, how easy it is to trade, and what can be made with trading. Some of it will be real, and some of it will be simply rumors. Today we will be looking at some of the uncomfortable truths about trading.

It takes money to make money.

Many of the people who start trading do it to try and make money, the problem is that a lot of them do it with the expectation that they can make a lot of money if they deposit $10 or $20. While trading is becoming more and more accessible, with brokers allowing people to trade with as little as $1 or $10, this has given people the idea that you can make a lot with such a small deposit. The truth is that you require a larger balance if you want to make anything worthwhile. You will need an account of $10,000 or more if you really want to make enough to live on, which is one of the goals that many people want to achieve.

Don’t get us wrong, you can make money with a $10 deposit, but you will be making pennies, not the sort of profits that have been promised to you on some of the adverts that you see about. #Trading needs to be viewed as a business instead of a hobby, for a hobby you may put in $100 but if it is a business you will be putting in a lot more money and you will then trade it like a business, resulting in much better profits.

You will make a lot of bad and wrong trades.

If we could be right 100% of the time, then you would be the most successful trader of all time, and you probably wouldn’t be reading something like this. You will make some bad trades and you will make some mistakes. In fact, you will make a lot of them, especially when you are just starting out. In fact, when you first start then the majority of your trades will probably be bad ones, this does not mean that you’re bad at trading, it just means that you are still finding your feet, something that everyone needs to go through. The unfortunate thing is that many newer traders do not realize that you are not going to make money to begin with and that you will be making a lot of mistakes, so if you are, do not be disheartened, everyone goes through the tough start, get through it and you will be able to move on to your journey of becoming a successful trader.

There is not a perfect strategy.

This is something that everyone is looking for, that perfect strategy that they can learn and then use for the rest of their life, the truth is, this type of strategy does not exist and will never exist for a number of different reasons. The first is that the markets will always be changing, they do not remain the same and will always change, they always have and they will continue to do so. Due to this, a strategy may work during one condition, but as soon as it changes, that strategy will not work anymore, you will need to adjust it so that it can adapt to the new conditions. The second reason is that if everyone had the same strategy, the markets would not movies ta all, everyone would be among the same trades and so no one would make any money, this is because you can only make money if there are people trading the other way to you, so if we all used the same strategy there would be no one to trade against, and so no money to make.

You need to be there at the right time.

This one is both true and not so true at the same time, it all comes down to the strategy that you are using for some you will need to be there at the right time, this can, unfortunately, mean that depending on where you live. You may need to be up in the middle of the night in order to catch the trades. If you live in a country that is active during the Asian markets, it can be a lot harder for you to be active in the London or New York sessions which are where most of the liquidity in the markets is. If you want to be successful in these situations then you will need to be able to be there to trade. This can be countered slightly by using trader orders, put them in, and then they will automatically take the trades, but these do not take live events into their equations so things can change while you sleep which could put your trades in danger.

Trading may not be for you.

Trading is a complicated and very difficult thing to become good at, so while it may be highly accessible these days, being profitable is far from accessible. Around 95% of traders quit or lose thor money in the first month if this is you, then it says nothing against you, trading takes a lot of time, effort and patience to be good at it, the majority of people will struggle to have all three of those things available to them. Work, family, and just life can very easily get in the way and make things harder for you. For some, trading is just not for you, and there is nothing wrong with that.

Robots, Signals, and Expert Advisors are not hands-free.

Something that a lot of people think is that all of the robots and signals that are being shared about mean that you do not need to learn how to trade, you do not need to do anything and you can still make money. This is not the case, have you wondered why there are not a load of millionaires out there that made their money from expert advisors? The truth is that they just do not work for a long period of time, the same can be said for the signal providers out there. Yes you can make some money over a short period, but things will inevitably go wrong when the markets shift in a way that the EA or signal provider is not able to deal with, this is when they blow and people lose their money.

You will not be rich tomorrow.

Trading is a slow process, in fact, it is a very slow process, so slow that you will most likely not see any progress towards your goals for a couple of months. People think that they can get rich quickly, but that just won’t happen, you will only be disappointed if you go into trading with that expectation. Lower Them, take your time and you can be a success, just don’t go in expecting the world overnight.

So those are a number of the truths that people do not know or simply do not want to know. Trading is not for everyone and it is not your ticket to financial freedom, at least not yet anyway.

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Beginners Forex Education Forex Basics

The Honest Truth About Forex Trading

From the outside, trading can look a little secretive, and without an actual understanding of it, when someone tries to tell someone else about what it is and how it works, it often goes straight over their head. This is understandable due to its complication and the amount of information that is available out there, all giving slightly different views and opinions on it.

What we do often get though, is people giving the more glamorized version of what trading and forex is, they seem to only tell others about all the wins, the profits and the excitement, not all the other parts that also come along with it. The stress, the losses, and the risk, those parts always seem to be neglected, it is understandable why though, when you are telling someone about something you like or enjoy, you aren’t going to tell them the bad bits, are you? You are going to tell them why you like it in the hope that they then also like it or can see why you like it. If you start or end the conversation with the negatives, they are often going to remember that and be put off.

So we are going to be looking at some of the truths of forex trading, some of the things you may not have been told as well as removing some of the sugar coatings that may have been put on. Don’t get us wrong, while there will be some negatives in this article, forex and trading as a whole is a fantastic thing and brings many amazing opportunities to people who otherwise would not have had the chance to trade. So let’s look at what some of these truths are.

Trading is a slow process.

One of the things you may well have heard is that you can become rich overnight with trading, well maybe not overnight, but it has been made out to be quite a quick process. The truth is, it is not, in fact, it is a marathon, more than a marathon even. If you go in with the idea that you will be able to make a lot of money quickly, you will only be left with disappointment and even potentially some losses. It takes a lot of time to learn and an even longer period of time to become profitable. You need to have the expectation that you will be doing this for at least a year before you have any sort of profits, it is a long process, so do not listen to those that say they make a lot each day, they are either exaggerating their results or just simply lying. Of course, there are some that make hundreds each day, but they either have huge balances or have been doing it for many many years.

There is risk involved.

This one isn’t exactly a secret, every website that has anything to do with trading and forex has a little disclaimer written somewhere telling you about how risky it can be, the problem comes from when people talk about it. People just mention their results and how well they are doing, they do not tell you that they had to risk quite a lot to get it. New rules came out for posting on social media to say that people need to display text about the risks, this was simply due to people losing money because others did not tell them of the risk and just the rewards. There is a risk, a lot of it, especially if you do not know what it is that you are doing. Do not trade with any money that you can not afford to lose.

There is no hands-off trading.

The new craze that has entered the trading and forex world is no hands trading or copy trading. This is where you simply copy the trades that someone else, more often than not described as an expert (whether they are or not you will never know) and so you just deposit your money, sit back, let them trade and you get the profits. The same goes for Expert Advisors, there are lots out there that allow you to set them up and just leave them. The problem with this is that the majority of people using them are people who have no knowledge of trading. They are blindly letting the robot or trader do their thing, there has not been an EA or copy trader where it hasn’t eventually gone bust, so without knowing or keeping an eye on things, it will go bust. You need to have an understanding of how it works and also be able to step in should things go the wrong way, total hands-off trading is just not a thing.

You cannot predict the markets.

No matter what anyone tells you, you cannot predict the way that the markets will move or react to different news events. Sometimes it does the complete opposite of what the logical move would have been. We have seen many times a positive bit of news making the markets go down, it doesn’t always make sense, and that pretty much sums up the markets. No one is able to predict what it will do, there are things that you can look at and analyze which can give you a better idea of how it should move during normal trading conditions, but again, this is not a certain thing. If anyone could actually predict them, then they would be a billionaire, but alas, this is not a thing and no one is able to do it.

Regulated brokers are not always safe.

Choosing the right broker when trading is vital, it needs to be one that you can trust, and that has a decent reputation. What many people will tell you will be to go for a regulated broker because they are safe, but are they really that safe? Well yes and no, the only thing that regulated brokers really offer in terms of safety is protection for your money, that is one of the requirements of the regulation, the thing is, some unregulated brokers have also protected your money. People seem to think that a regulated broker won’t ever try to cheat you out of your money or that they will always do what they can to help you, but that isn’t actually part of the requirement to become regulated, there are a number of cases where these regulated brokers have received fines or warnings for their not so user-friendly actions. Go with a broker with good reviews and a good track record, not one just because of their regulated status. It should also be noted that there are a lot of different regulations, some far better than others, so be sure to check which one your broker is regulated under before assuming what protections may be there.

You cannot be successful with a $10 deposit.

Something that you see people saying these days is how you can be a successful and rich trader with just a $10 deposit. We have to admit, it is great that brokers are allowing you to sign up and try things out with a deposit as low as $10, but if you want to be successful, you will need to deposit quite a bit more than that. Risk management is key in trading and you won’t be able to do anything effective with a $10 account. In fact, you won’t be able to do too much with anything else that $1,000. With a higher deposit, you are able to protect your account a lot more, so while you can start with just $10, you won’t be successful with it. Having said that, some people have grown it, but the initial stages take a lot of luck to get through with such a small account balance.

You will have plenty of losses.

Losses are as much a part of trading as a win, in fact when you start out you will most likely have more losses than wins. Being able to deal with them and bouncing back from them is one the most sought after traits when it comes to being a trader. When you go into trading, you need to have an understanding that there will be a lot of losses, small ones, large ones, whichever ones they are, they will be there. People will only tell you of their wines and not their losses, so it may seem like they are few and far between, don’t take that for granted, there will be some, and lots of them.

So those are some of the truths about trading and forex, there are of course other things that you hear which may not quite be the truth, you will always hear the exaggerated truths from people who enjoy trading or want to get their hands on your money. We hope that we have opened up your eyes a little bit, trading can be incredibly life-changing and rewarding but do not get ahead of yourself and do not take things for granted. Work hard and you will be able to be successful.

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Forex Videos

Why You Will Never Make Money In Forex! Hard Facts!

What is it that successful traders have, that 75% of retail traders do not?

Regulated forex brokers are now required to advertise the percentage of losing accounts, and where this information can usually be found at the bottom of the broker’s website landing page.
If you have the time to flick through a few of these, you will notice that the average amount of retail traders who lose their funds trading CFDs or spread betting runs at well over 70%. So just what are these people doing wrong?
Well, there is no single formula for success in trading Forex, but most new traders do not appreciate that there is a steep learning curve before one can jump in and start trading. Many of them will see a couple of videos on YouTube about trading and think that they are off to the races. When, in fact, trading in the financial markets requires great skill and knowledge.

 


There is an old adage that: failing to prepare is preparing to fail, and never has that been more true than in the forex market. But let’s say that you have learned about fundamental analysis and how economic factors can affect the value of a currency, and whereby economic data releases can also cause extreme exchange rate fluctuations and where you have done your homework and learned about some technical indicators, and yet you have hit a brick wall and are not trading successfully. What are the professional traders doing that you are not?
Professional Traders are rigid in their approach to trading. They will have developed a trading methodology, and they stick to it like glue. And this is one of the biggest mistakes that new traders fall into: they chop and change their routine, they do not have a designated methodology, developed through trial and error and use many different technical indicators and timeframes, and flit from one currency to another and even one asset class to another such as turning from Forex to stock indices and oil, etc.


It is essential that you choose a time frame to suit yourself and your lifestyle. If you have a busy life and are looking to trade Forex as a supplemental income, do you really want to be trading on a long-term timeframe, such as daily, weekly or monthly charts, where positions could run against you for weeks at a time and cause you stress, worry and sleepless nights? If you do not have a problem with this, fine. But if you are looking for quick in and out trades, on an intraday basis, then you need to be looking at a 5-minute or 15-minute timeframe and certainly no longer than an hourly chart.

And therefore, psychology really does play an important factor in your trading. This is another key area that new traders do not take into consideration when they start their journey into Forex.


Professional traders have discipline, where new traders tend to be eager and haphazard in their approach to trading. A professional trader will be patient and wait until the price action reaches an area that he or she has defined as being the correct level to instigate a trade in order to maximize their profits. Professional traders will have tested their methodology and tuned it to perfection and stick to it without deviation. Therefore, what new traders must do is to find a trading formula that works for them, having first tested it on a demo account. Because if you cannot make money there, you will not be able to make it on a real money account. Once your methodology is working consistently, only then should you consider risking your real money trading Forex.

But the number one key feature that professional traders use consistently is risk control, by implementing stop losses. And the number one feature where new retail
traders lose their money is because of poor risk control, and where a lack of stop losses will see account balances wiped out