Beginners Forex Education Forex Basics

Top 15 Undeniable Reasons to Love Forex Trading

When it comes to trading, there are a lot of things that we love about it, we would not be trading if we didn’t love it after all. We are going to be looking at 15 of the reasons why we really love to trade and how those different loves affect our outlook at our trading.

1- You can make money.

Who doesn’t love this aspect of trading? The fact that you can make a little extra money, or even a lot of money is a real draw-in for a lot of people and it is for us too. For a lot of people, the fact that you can make money is the initial draw in and the reason why a  lot of people trade, if there was not an opportunity to make money then there would be far fewer people actually trading.

2- Anyone can do it.

The great thing about trading is that pretty much anyone can do it, of course, there are a few limitations like needing to be over the age of 18 and to have access to a computer or phone, but otherwise, there is pretty much nothing stopping you from taking part, brokers are accessible, the markets are too. If you want to trade, there is always a way of managing to do it.

3- It’s very accessible.

As with the above, trading is getting more and more accessible and it has never been easier to get involved. You only need as little as $10 or even $1 for some brokers to get started. You can also access it from anywhere that has an internet connection using a desktop computer, a laptop, or even a smartphone, heck even some fridges have the capability of doing it now too. If you want to trade, there are more than enough ways to get involved and it is very easy to get started.

4- You can do it on your phone.

As we mentioned above, your smartphone is not a full-fledged trading terminal, years ago people would never have thought that they would be able to trade on their phone, now you can. On the train, on the couch, on the toilet, no matter where you are, as long as you have your phone with you and an internet connection, then you can very easily start trading.

5- It doesn’t take long.

You don’t need to be sat in front of the computer to make trades, it can be done in a few minutes, of course when you are first starting out it will take quite a bit longer, and you need to do the initial learning, but once you know what you are doing, you can get through your trading pretty quickly. That is something that we love as we do not want to spend 5 hours a day putting on trades.

6- It provides good reading material.

There is a lot of information when it comes to trading which is great for those that have the time to read. You can read up on things pretty much anywhere you are and there will always be something new for you to read and learn about. No matter the sort of writings you like from fact to fiction, there will be some related to trading that will suit your tastes.

7- There is a great community.

The trading community is one of the best, once you get past the plastic traders or those trying to get other people’s money, the community is fantastic. They are always there ready to help, to share ideas, and to discuss different things related to trading and the markets. There are a number of different communities out there so it shouldn’t be too hard to find one that suits you. They are also a great place to let off steam and the frustrations from trading.

8- You can work from home.

One of the main draws for a lot of people is that you can work from home, you can choose your own times to trade, you can trade as much or as little as you want and you can have a nice lie each day. It is fantastic being able to trade from home and to avoid the long daily commute that you used to do when you worked your previous 9 to 5 job.

9- You don’t have a boss.

Most of us hate having a boss, it is something that pretty much any job comes with and it is something that we strive to get away from. Trading is the perfect place to get rid of your boss and to basically be your own boss. Lots of freedom to do what you need without someone peering over your shoulder is a fantastic feeling and one that trading can very much provide you.

10- There are a lot of assets to trade.

There are a lot of options and assets to choose from, you will always be able to find one to trade and one that suits your style of trading. If one is going slow, fund another, there will always be options. That is the fantastic thing about trading, there are currency pairs, oils, metals, stocks, and more to choose from, so you will always have things to do and it will always be exciting.

11- It’s never boring.

Trading is never boring, things are always happening and this makes it so good to trade. Just when you think you will have a quiet period, something will happen, a news event, a disaster somewhere, whatever it is it can really shake up the markets and move things about. Even when you have trades open, you will need to keep an eye on them simply because anything could cause the markets to move. Some currencies can be slow, but there are others that will certainly be doing something.

12- Helps you control risks in life.

A part of trading is risk management, if you’re able to do it during your time trading then you can certainly take that into other aspects of your life too. Take what you learn and start reducing the risks that you are taking in other aspects of your life too.

13- It’s a profitable hobby.

Hobbies often cost you a lot of money, trading is a little different, it can actually help you to make money, not many people can say that their hobby brings them additional income rather than costing it. It takes time and work, but it can certainly help you to make a little extra on the side.

14- You can trade at any time.

There are no limits as to when you can trade. You can trade first thing in the morning, late in the afternoon, or in the middle of the night, the markets are always open. They close over the weekends but otherwise, they are a 24/7 opportunity to make money that you certainly should be taking advantage of.

15- It provides a shot of adrenaline.

Trading can be exciting, it can really boost your adrenaline levels, especially when the trade is doing the right or wrong way, it can really pump us up and that is a great feeling, for many, it is what they trade for. If you find trading boring then you won’t get this, but for the rest of us, the excitement is enough, the money is a bonus.

Those are some of the reasons why we love trading forex and why you should too. There are of course more reasons out there, but these are the main ones that come to mind. Think about why you love trading, and keep that in mind next time you get frustrated or bored. We will always love trading, and so should you.

Forex Basics

40 Key Phrases About the World of Finance by Robert Kiyosaki

Robert Kiyosaki is an American entrepreneur, investor, writer, speaker, and motivational speaker of Japanese descent. He is the founder, CEO, and majority shareholder of Cashflow Technologies, a corporation that holds the licenses for the “Padre Rico Padre Pobre” brand, his best-known work.

Kiyosaki has provided us with excellent readings, those capable of inspiring and transforming the lives of anyone. If anything stands out Robert Kiyosaki, it is his vocation to teach, his vocation to serve others. This vocation has led him to write a book where his purpose is to teach what is the vision that children should have about the financial culture. A culture that, unfortunately, is neither taught nor encouraged in the classroom. We will focus on providing phrases that I think can be tremendously revealing when it comes to the concept that modern society has about financial education.

What follows are forty of Kiyosaki’s most notable phrases.

“Teaching about money is not given in schools. The school focuses on professional and curricular skills, but not on financial skills.”

“Making money work for you is a permanent topic of study. Most people attend college for four years and their education ends.”

“You have to learn to master money, not to be afraid of it. And they don’t teach that to kids, and if you don’t learn it, you can become a slave to money.”

“The main cause of poverty and financial hardship is fear and ignorance, not the economy or government of the rich.”

“For most people school is the end and not the beginning.”

“To spend your life in fear, without exploring your dreams, is cruel. Working hard to make money and thinking that money will allow you to buy things that will make you happy is also cruel.”

“A job is the solution for the short term but it will be a long-term problem.”

“We focus on the word education and not on financial education.”

“In accounting what matters is not the numbers but what the numbers tell you. It’s like words. The important thing is not the words, but the story that the words tell you.”

“An asset is something you put in my pocket. A passive is something you take out of my pocket. If you want to be rich, just spend your life building assets.”

“What is needed in education is not how to make money, but how to spend it; that is, what to do after earning it. That’s called financial fitness.”

“Making more money rarely solves a person’s money problems. Intelligence solves them. If you find out you’re in the hole… stop digging.”

“An intelligent person hires people who are smarter than her.”

“You need to learn how to make your efforts benefit you and your family directly.”

“The rich acquire assets. The poor have only expenses.”

“Financial problems are often the direct result of people working their whole lives for another investor. Most people will have nothing when their working lives are over.”

“Our current education system focuses on preparing young people today for good jobs, rather than developing their financial skills. Their lives will revolve around their salaries.”

“What often happens with school is that you will often become what you study. (…) The mistake in becoming what one studies is that many people forget to take care of their own business. They spend their lives running someone else’s business and making that person rich.”

“Start by running your own business. Keep your job, but start acquiring real assets, not liabilities or personal effects that have no real value once you are home.”

“The first lesson to make money work for me instead of me working for money is actually about power. If you work to make money, you give power to your employer. If your money works for you, you retain and control power.”

“Most people only contemplate for their lives to work hard, borrow and save.”

“Poor people, and in general the middle-class work only for money, the rich make money.”

“Saving money every month is a solid idea. It’s an option: the option most people follow. The problem is this: it blinds people to what is really happening.”

“My child is doing well in school and is getting a good education. It may be good, but will it be adequate?”

“Financial intelligence consists of four main skills:

  • Financial education. The ability to read numbers
  • Investment strategies. The science of money creates money.
  • The market. Supply and demand.
  • The law. Know accounting rules and regulations.”

“Real opportunities aren’t usually seen with your eyes, they are seen with the mind.”

“Unfortunately, people are not rich because they are terrified of losing. People who avoid failure also avoid success.”

“Work to learn, not to earn money.”

“There is an old cliché in English that states that the word JOB is the acronym for Just over broke.”

“Since the school considers financial intelligence to be a form of intelligence, most workers live according to their means. They work and pay their bills.”

“I now know people who are often too busy to take care of their wealth. And there are people who are too busy to take care of their health. The cause is the same. They’re busy and they’re busy as a way to avoid something they don’t want to face. No one’s told them. Deep down, they know.”

“The problem I detect today is that there are millions of people who feel guilty about their ambition.”

“The message repeated to us again and again is: Let us work hard, let us earn money, let us spend it; when we run out, we can always borrow. Unfortunately, 90 percent of the Western world adheres to this dogma simply because it is easier to find a job and work to earn money.”

“All of us have a choice. I simply chose to be rich and make that choice every day.”

“Invest first in education. Actually, the only real asset you have is your mind.”

“Most people simply buy investments instead of first investing in learning about investments.”

“The poor have bad habits. A very common bad habit is innocently known as «resorting to savings». The rich know that savings are only to create money, not to pay bills.”

“We go to school to learn a profession in order to work for money, when it’s about making money work for you.”

“You were all given two gifts: your mind and your time. It is up to you to do as you please with both.”

“There are five main reasons why people with financial literacy cannot develop their asset column:

  • Fear
  • Cynicism
  • Laziness
  • Bad habits
  • Arrogance”

The relationship between Robert Kiyosaki and Forex has always been close and has left us with a lot of lessons, but only that, good lessons and ways forward to achieve success as investors. Robert Kiyosaki has never encouraged trade of any kind but has confined himself to analyzing and trying to educate through his books and lectures to have a winning mentality, and that we can eliminate all our fears so that we have the best habits for our investments.

As a curiosity…, one of Robert Kiyosaki’s latest statements predicts that Bitcoin will be worth $75,000 in 3 years. This means the price of Bitcoin will increase by almost 100% a year over the next three years. Will it come true?

Beginners Forex Education Forex Basics

Why We Love Forex Trading (And Think You Should, Too!)

Forex and trading are becoming an ever-popular activity. For many, it is just about making a little extra money on the side, while for others, it is about the enjoyment that they get out of it. There are a lot of ups and downs when it comes to trading, but overall, those that trade it for a hobby seem to love it. There are plenty of reasons to love it too, from the ups, the profits, the thrills, and more, so we are going to be going through some of the reasons why we love trading and the reasons why you probably will too.

The Incredible Highs

For many people, anything to do with money can give you some serious highs when you win. This is exactly the same when it comes to Forex. When you are winning, or on a winning streak, you feel like you’re on top of the world, you feel like you are on cloud nine and pretty much everything is great. If You have been trading forex for a long time, you will have experienced this a number of times, there isn’t a feeling like it and that is one of the reasons why we love it so much, that feeling is created by something that you have done, which makes it all the better.

The Adrenaline

There are many things in life that can fill us with adrenaline. When we are in charge of our money, and that money is actually doing something, that is one of those situations. When you see the markets moving up and down and your balance moving with it, you will gain a huge boost of adrenaline. This is true for when the markets are going both up and down, you want to win, you don’t want to lose. Whichever way it is moving, it will be playing with your emotions and filling you with adrenaline. It is basically what keeps bringing us back. There are, of course, some traders that are more methodical. They don’t get the emotions that the majority of us do. Instead, they are there simply for the money, but the majority, when things are going really well or really badly, will be filled with this emotion and the feeling of adrenaline going through their veins.

The Money

Let’s be completely honest, we are only trading because we can make some extra money, and the majority of other people are in the same boat. In fact, we have not yet met a single trader that is not taking part in trading for anything other than the money that can be made. Each month we withdraw a little bit of money that we can use to help us live a better life, to pay off debts, or to simply be a little better off. If the money was not there and you did not get any benefit, we certainly would not be trading. So we love trading for the simple fact that it allows us to make a bit of extra money each month.

You Don’t Need A Lot to Start

When I first started out with my trading, we started with about $100, which was great. It meant that we didn’t need to break the bank in order to start our trading journey, this made it very accessible for us. These days you can start with even less, some going as low as $10 or even $1. Of course, you will find it hard to be profitable with such a small amount, but it just shows that anyone can get started as you do not need thousands in order to join in. That is such a great thing for forex when you compare it to other things like stocks where you need a lot more in order to make any sort of decent money.

It’s Highly Accessible

Trading forex can be done from pretty much anywhere. We use our desktop computers, our laptops, and even our mobile phones to do it. The fact that you can use pretty much any platform that you want to access your accounts and the markets means that no matter where we are, we will be able to trade and potentially make money. It also means that far more people can get involved, many do not have a computer or a laptop, but they do have a mobile phone that is compatible with the trading platforms, meaning that they can now trade. A few years back when these platforms were not as easily accessible and so many people just couldn’t trade, that is simply not the fact now and those that missed out can quite easily get involved.

You Can Do It From Home

Normally, when we want to make a little bit of extra money, it will mean that you need to go out and get a second job, and you need to leave the house to do it. This is thankfully not the case with trading forex, you can do that from home, from in your underwear with no need to leave the house at all. This means that there is no commuting, no traffic, no other people annoying you on the way to work.

There Is No Boss

When we trade, we trade for ourselves, we are in charge of what we are doing and there is no one to tell us what to do. We have no boss, something that so many people strive for and something that a lot of people get into trading for. It will take a while to get to this stage, you need to be consistently profitable before you even think about leaving your job, but once you do, you will have all the freedom to trade when you want rather than when you are told to, freedom to choose.

Helps Us Manage Our Risks

When it comes to money, a lot of people are worried about losing it, this is why we use so much risk management when we trade and for good reasons too. The good thing is, that the cautious approach that we put into our trading we can take out into the real world too. Looking at more information before investing any money, before making decisions that will affect our lives. It helps us to better analyse the decisions that we are going to be taking.

It’s Always Changing

The forex markets are always changing, and due to that, we are very rarely bored. There are, of course, slow times when the markets are not really doing anything and our strategy is not relevant, those are times to take breaks. The rest of the time it is always evolving, due to this there are always things for us to do and for that reason, we simply do not get bored with it. We can always develop our own knowledge, we can always try and trade something else, either way, we are simply not bored by the forex and trading markets.

Those are some of the reasons why we simply love trading and the forex markets. It gives us so much freedom, teaches us a lot, and allows us to take part in it pretty much anywhere in the world. There is nothing quite like it, we love it and we are sure that you most likely will too.

Forex Basics

Is Forex Trading Honestly Really Worth Your Time and Effort?

It is a well-known fact that forex trading brings together a truly vast range of diverse personalities all over the world, and being such an incredibly big and booming market, it easily arouses interest in individuals regardless of their background and past academic and professional achievements. Naturally, we all desire to gather as many pieces of information right from the start, so we browse the internet in search of evidence that would confirm our compatibility with the market demands and benefits.

Not only do we want to see the fruits of our labor as fast as possible but we also realistically demand to have a clear vision of what responsibilities and tasks we can or cannot expect to take on or carry out ourselves. This thirst for concrete and relevant facts can now be quenched because the entire mental turmoil boils down to the question of whether forex trading is really worth it. For these reasons, let’s objectively analyze the key aspects that determine our motivation, satisfaction, and persistence in this market. 


Forex is, fortunately, or unfortunately, an entire field that is defined by specific terminology and rules that all need to be studied and understood. On a positive note, having a subject so well defined and studied as extensively offers more and more sources of information than ever before, including articles, podcasts, social media posts, videos, and trading courses. The ease of access and the myriad of places and vehicles to get educated, however, do not always support the learning process because the information offered does not always reflect original thought and what we can expect in real trading situations.

What is more, while cramming a whole set of new vocabulary and concepts they have never heard before, traders with experience in some other markets (e.g. stocks) may increasingly face difficulty due to seemingly identical tools and techniques. And, while there is so much to learn, potential or beginner traders also need to bear in mind that this is just the theoretical side of what needs to be done and that all theory ought to be properly exercised and tested to reach excellence just like in any other learning program. Nevertheless, after completing this stage, traders can rest assured that they will likely never need to go back to studying the basics, provided that they invested them conscientiously and whole-heartedly.

The Costs 

People are, understandably, drawn to trading currencies because they are keen on improving their finances. Nonetheless, forex newbies often discover later on how they already need to have a specific sum of money prepared in advance to be able to enter the market. Even though investing occurs in one of the later stages in a beginner’s trading development, we do not want to have any relevant items of information escape our focus, so we must learn about brokerage, commission, spread, and all other more obscure fees. An important part of this topic includes the topics of risk and leverage that, if not properly handled, may affect your trades and ultimately your account. If traders do not learn how to properly manage their trades and restrain their shadier personality traits (e.g. greediness, fear, impatience, laziness, etc.), their accounts may suffer consistent or intermittent blows that may never be compensated for by any wins no matter how big they are.

Time Committment

Time is an invaluable asset and the reason why many experts opted to put effort into learning how to trade currencies in the first place. Now, even though traders at the beginning of their careers may have already heard professionals talking about how their routines changed after learning about forex, they should still not forget that it is the decisions we make each step that have a say in how our life is going to look like in the future. First of all, in order to become knowledgeable about forex, you will need at least six months to study theory and start a demo account where you can apply what you learned.

Under the condition that you spent the learning period actively and without being superficial, you can become a professional trader (i.e. someone trading real money) even after a year, after which you will be able to tweak and improve your system if and when needed. It is also important to include psychological growth in this section because trading tends to bring out our worst fears and limitations in people, and overcoming emotional hurdles often takes more than 12 months. Finally, you may also need to consider a bigger time frame if you wish to make some significant lifestyle changes, as many traders become dependent on trading all day, missing out on the opportunity to experience a different type of routine.

Prospective Returns

You will double your investment in the blink of an eye, they say on various blogs, but they fail to mention that the market conditions and simple math will not let you go beyond a specific percentage simply because the big banks would lose their profit in that case. Some of the most prominent figures in this market make 20% per year, and while this can turn out to be quite a large sum, you need to calculate your own return based on your initial investment. Therefore, if you deposit 500 USD and manage to get a 13% return, you will get a realistic image of your yearly earnings from trading currencies. Also, if you happen to struggle with your algorithm and start taking severe losses, understand that the world forex does not offer any trick by which you can magically let you start over with a clean slate. Despite these difficult aspects of trading currencies, you can always present your records to a company that would pay you to trade on their behalf and increase your returns in that manner.


We all have a different starting point in terms of age, available capital to invest, social obligations, and work/school schedule, among others. Any trader wishing to become successful at forex needs to set aside a designated period in a day or a week that he/she would dedicate to learning and testing. Some traders may choose to do currency trading on the side, keeping their day jobs or prioritizing other trading activities, while others may want to focus on forex only. Therefore, both before and after one feels ready to start investing real money, it is absolutely crucial that each step be free of the stress and the turmoil of the outside world. A proper routine also entails methods to calm oneself down and direct one’s attention to trading alone.

Another vital piece of advice for all traders, be they beginner- or professional level, concerns developing the habit of meticulously recording each trade. Not only does proper data management help traders track their growth, improve their trading systems, and perfect their strategies but it also leaves room for traders to enter into a trading agreement with a desirable company, fund, or institution as discussed above. 

Potential or beginner traders have much to ponder on before changing their lives in a way that would impact their finances, time, and schedule. Some people may be quite reluctant to apply anything new in their life and others cannot bear the idea of having to sit down to study or take records each time they enter or exit trades. The key ingredient in all this decision-making is the individual vision of the future and balanced expectations of oneself and forex. Forex can offer much, but at the same time, it is you and you alone who need to make things happen. It is important to be honest with oneself from the very start as well as be prepared for a steep learning curve before being able to reap the benefits of this market. 

Forex Psychology

Identifying and Harnessing Your Trading Strengths

The internet is filled with resources for traders, including articles, videos, and other mediums where experienced traders can share information and tips that will help you. However, a lot of this information seems to focus on what you’re doing wrong as a trader. For example, the entire field of trading psychology seems to focus on negative emotions and the ways that they play against you. You’ll also find articles that talk about bad trading habits, weaknesses, and other mistakes you might be making as a trader. All of this is important, but you might be left wondering what you’re actually doing right if you only look at resources that tell you what you’re doing wrong. 

If you’re trying to identify your trading strengths, you can start by taking a look at your trading journal. Hopefully, you’ve already been keeping detailed notes about each trade you’ve taken in your journal to help make this step easier. If you haven’t, you should start keeping a log right now. This won’t only help you with identifying your trading strengths, but it can also help point out weaknesses and help you identify other issues you might miss otherwise. From there, try identifying your 10 most profitable trades and look for common factors among them. Did you trade the same pairs, stick to your trading plan, or enter the trades based on a certain type of evidence? If you can identify things those trades have in common, you’ll have an idea of what you’re doing right. 

Another tip is to try to identify your strengths as a trader. This can seem hard at first, especially since you have to apply the adjectives to yourself, so we’ll provide a few examples:

  • Persistence
  • Self-control/discipline 
  • Creativity
  • Open-mindedness
  • Interested in learning
  • Wisdom
  • Curiosity 
  • Humor 

Basically, you need to think of the positive traits you have and then figure out a way to apply them to trading. For example, if you have an easy time laughing even when things are tough, you could use your humorous personality to help yourself get over any trading losses, rather than feeling depressed over them. You probably already apply some of your positive qualities to your trades, but it can help if you’re more aware of these qualities so that they can be used most effectively. 

Finally, you can try asking other people for their opinions on the way you trade. This could be a close friend, family member, or colleague with trading experience, or you could turn to the internet to get help from other traders online. Sometimes, others might be able to see things you can’t see about yourself and you’ll be able to get opinions that aren’t biased. Ask your friends what they see as your trading strengths and then compare the results to what you originally pinpointed to see if they match or differ. You might just learn something about yourself!

As a trader, it’s important to identify your weaknesses so that you can figure out healthy ways to address them. At the same time, you need to know what your strengths are so that they can be used to your advantage. Try keeping a trading journal, identifying your personal strengths and comparing those results with other’s opinions, and figuring out ways to use your identified strengths when you’re trading to get the best results possible.  


Forex Basics

Three Key Factors that Day Traders Should Consider

30Day trading is a popular trading strategy that involves placing multiple short trades per day, with each trade being closed out before the end of the trading day. It is known as a profitable, yet demanding trading strategy that can give good results when practiced effectively. Of course, each trading strategy comes with its own strengths and weaknesses, along with things that should be considered. If you feel that day trading is the right strategy for you, be sure to consider the following:

Factor #1: Money

Just how much cash do you have available to deposit into a trading account? As a day trader, you’ll need to open at least a couple of trades each day, so you’ll probably want to deposit enough money to keep you afloat for a while to avoid quickly reaching a $0 account balance. This is especially true if your broker charges fees for making a deposit. You’ll also want to set some realistic expectations related to how much money you’re planning to make. If you start out with a $25 deposit, you won’t be making thousands of dollars right off the bat. Meanwhile, a larger deposit of around $30,000 might leave you with returns around $3,000 per month. Of course, everything is subjective when you’re trading, so it isn’t wise to set specific monetary goals. Still, you’ll want to figure out how much you can afford to deposit and be sure to have a realistic idea of how much money you might make. 

Factor #2: The Cost of Trading

Each broker charges a different amount for spreads, commission charges, transaction costs, and so on. Some brokers offer competitive pricing, including low spreads and possibly even fee-free withdrawals. However, others will charge you an arm and a leg to trade and might even throw in some nasty surprises like inactivity fees, account maintenance charges, etc. In order to wind up with more money in your pocket, you have to be able to make enough of a profit trading that your winnings aren’t gobbled up by these fees before you ever even receive your withdrawal. Fortunately, you only need to invest a little time into finding a good broker with attractive costs to avoid this problem. Be sure to read the terms & conditions for each option you’re considering to look for information about these hidden fees and avoid brokers that aren’t upfront about their charges, as this is a sign that a company is trying to scam you. 

Factor #3: Stress

Did you know that short-term traders like day traders and scalpers are actually exposed to more stress, which can lead to psychology-related trading issues? This is mainly because you have to work quickly while taking in a lot of information. The timed pressure can make it easier to make mistakes along the way and you might find that your head feels like its spinning after a really tough trading session. If you already struggle with anxiety on a daily basis, you’ll probably have a difficult time adjusting to the pressure that comes with this type of trading strategy. One thing you can do to help take some stress off is to make sure you aren’t crowding your charts with unnecessary indicators, take a break if trading becomes too much to handle, etc. However, day trading might not be right for you if you can’t keep up with fast-paced trading. In that case, you could consider swing trading or another strategy that isn’t as stressful.

Beginners Forex Education Forex Basics

Activities That Can Help You Be a Better Trader

Trading can be a long process, it can be draining and it can also be unforgiving. Sitting at a computer for hours on end is never a great way to spend your day, but more often than not it seems like a necessity. When the markets are slow, or you have just lost a couple of trades, it is important to be able to take a step back. Do something to refresh yourself, and then come back. That is why we are now looking at a number of different activities that have nothing to do with trading, but they can still help your trading performance.

Playing Sports

This may be obvious to a lot of you, but you would be surprised how many traders either give up their physical activities in order to trade full time. Without going into the really scientific side of why sports is beneficial for you, the main aspect is the energy that it provides, you may be feeling tired straight after, but the long term effect of exercise includes boosts in energy, better concentration levels which then allows for more patience and discipline. Taking part in sport is also a great way to teach your body different aspects of discipline and preparation, important aspects of trading. Some sports like Boxing are also great for getting id of any underlying frustrations that you may have about the markets and your trading.


A little like sports but slightly less physical (no less challenging though). Yoga can be used to help relax and focus your mind. When you have come off a few bad trades, it is hard to get out of that cycle, so being able to refocus your mind and relax is important. Being able to take what you learn in Yoga into the markets can also be fantastic, being able to channel your focus into the markets and your strategy can really help boost your productivity and profitability.


You probably thought this would be number one, it would be if we were looking at trading related books, but we aren’t, that would still be an activity to do with trading. A good book can take your mind away from your trading, to completely remove it from your mind so you can relax without the stresses.

Having said that, you can often find elements of trading in a lot of books, not necessarily related to trading, these could give you ideas of new trading strategies or ways you can adapt your own, often when your imagination is working (reading books) you can come up with ideas that you never would have before.

Talk to Other Traders

This one may seem obvious, and to be fair it is, but it is something that a lot of people do not do, many traders, especially the newer ones get absorbed into their trading, they forget about the other thousand traders around them that are going through the same thing. Talk to them, if you are having trouble with something, someone somewhere will have a solution for it, talking can help you find it, it is also a great feeling to help others, so giving your own wisdom to others can help the overall trading community.

Travel/Get Out of the House

Heading to a sunny shore or a snowy mountain may seem like a bit of an extreme, but giving your mind that extended break from trading can help refresh your mind. It can also give you a completely new and fresh perspective when you get back, often coming up with ideas you had never thought of before due to being stuck in a routine. If you cant get away for long, just get out to the local park, do something completely different, even a few hours can refresh your mind.

So there are a few different ways that you can help to refresh your mind or gain knowledge away from the trading platform, it is always important to add a bit of variety to your life, trading all day every day is not a healthy habit to get into, how you add that variety though, is up to you.

Forex Psychology

Avoiding Burnout While Trading Forex

Forex trading can be stressful. Anyone that tells you otherwise just won’t have come across one of their bad patches yet. Every single time you trade you are being put in front of a number of different stressful situations, as they begin to build up it can cause stress, frustration, and ultimately causes burnout.

I am sure that there have been times in your life when you have been doing something repeatedly and you end up thinking that you can’t really be bothered to do this or that it is incredibly boring. This is often referred to as burnout and it is quite common amongst forex traders, especially if things haven’t quite been going the way you intended it to.

The good news is that there are ways to avoid or at least reduce the effect that it can have on you, it is important to recognise the signs and put into place some things that can help you to relax and unwind, otherwise, a burnout could cause a complete loss of motivation or even trading mistakes that could cost you money.

Spot the Signs Early

It is often quite hard to spot when you are going through a tough spot, a lot of the time it is normal for you, so it is important that you are able to recognise the signs of burnout coming up so you can quickly do something to help alleviate the issues. You can spot these early signs by asking yourself a few questions, they are quite straight forward but the more that you answer yes to, the more likely you are on your way to burnout.

  • Do you have feelings of self-doubt?
  • Do you question why you are trading?
  • Are you suffering from headaches?
  • Are you still sticking to your strategy?
  • Are you eating more or less?
  • Are you drinking alcohol more often than usual?

Ask yourself, if just one is yes, then take a break, if more than one is yes, then you may be on your way to mental burnout.

Take a Break

This is a simple step to take, simply step away from trading, for a day, 2 days, a week, whatever you think is necessary for you to alleviate some of that stress or thoughts of self-doubt, use this time away from trading to exercise eat healthily and simply clear your mind of trading and the stresses that come with it.

Think Back to the Start

What we mean by this, is to think back to when you started trading, the excitement that it brought, the new experiences, and the feeling of learning something new and being able to implement that into your trading strategies. Use that feeling that you had, use it to help kickstart your own passion for trading, this will help you to focus on some of the better and more positive sides of trading rather than the stressful ones that have put you into your current situation.

Find a Friend

This can be taken in two ways, you could look for someone outside of trading to speak to or to simply spend time with, time with others is a great way to get rid of stress, as long as you like them that is. Then there are trader buddies, these are people who also trade that can be there to discuss what is going on, the good thing about having a friend that also trades is that they will have also experienced the exact same things that you are now going through, they will be understanding and may even have tips on how they avoided or got out of a burnout situation.

Get Pampered

Complete relaxation and clearing of your mind, a little similar to taking a break, but this time it is all about you, you need to do something that you enjoy, whether that is a massage or a game of tennis. Think about you, cater to your own needs and loves, this is a fantastic way to reduce the risk of burnout as it clears your mind of the issue and you gain that adrenaline and euphoria of doing something that you truly enjoy.

Ask for Help

Do not be afraid to ask for help, if you go into burnout and still try to stick with it, it can be damaging not only for your trading account but for your overall physical and mental health. The worst thing you can do is try and push yourself through it. There are people around, both friends and professionals who have been trained for this sort of thing, there is no harm or shame in asking them for a little bit of help, in fact, it is strongly encouraged. The good thing about talking to professionals is that they know all the signs and they also know a lot of things that could be causing them, in fact, you may discover that your burnout is nothing to do with trading at all and is instead something that you have locked away inside or didn’t even think of as stressful.

Being able to recognise the signs and then take control of them is the key to avoiding and getting out of burnouts, it is not a good place to be but there are things that you can do to help avoid them and there is also help available out there should you need it. It is something that we all go through so it is nothing to be ashamed of, look after yourself and then you will be able to look after your trading.

Forex Psychology

How to Approach Trading Changes Positively

Change, something that you either love or absolutely loathe. Whichever approach is relevant to you, you are going to need to embrace change in life and especially when trading forex. There isn’t a moment that goes by where your single trading strategy or plan will be 100% correct. The markets change, you need to change with them, adapting to whatever is being thrown at you. It is a challenging thing to do, but a vital skill to learn.

If we take a little look at people who really excel in their field, people who do a fantastic job of getting to the top and then staying there. Let’s take a look at Taylor Swift, nothing to do with trading but bear with us. When she started out she was shy, her music was based around country themes, all about love and romance. However the generation of people who grew up with her started to get older, their taste in music began to change and so then Taylor had to change also, if she remained the same, she would have lost a lot of fans. So instead, she adapted, she changed her music, constantly, there were never more than two songs with a similar theme in a row, this enabled her to keep her fans interested and engaged in her music. She did this and it worked, she is now more popular than ever.

This same way of changing to the needs around you can be seen with many other successful people. Warren Buffett had to adjust his style when the first few investments didn’t go the right way, Michae Jordan had to change his style of play early on in his life after being dropped by his high school team. The thing that all of these people have in common is the ability to change and adapt. If you wish to become a successful trader, then you are going to need to learn how to do this yourself because lets be honest, the markets will change, they can change hour to hour, if you are not ready to change with it, then you will be making some mistakes and you will be making some losses.

One of the things that makes a lot of traders fail is either their inability to introduce some of the much-needed changes or simply that they are unwilling to do it. Traders can very easily get stuck in their own ways, they have been successful in the past so the way that they see it, is that their strategy will be successful again in the future. This is a mentality that a lot of people get, but it is also one of the most dangerous as it will only lead to losses, potentially major losses when the markets have changed.

So let’s look at things in a way that is probably more familiar to you. Let’s assume that you have a scalping strategy, your strategy relies on the markets to be going sideways, ranging up and down between particular ranges. This works fantastically when the markets are doing what you want them to do, the problems arise when the markets begin to shift, they begin to trend. You’re now trying to scalping the opposite direction to a trending market, this will lead to either a large loss or a lot of little losses, neither of which are great. If you are not able to adapt to this situation, to change your trading style, or to completely step back, then you are going to end up losing out, so we need to work out a way that you can alter your current strategy to better suit the current situation that the markets are in.

So we have an understanding that we need to make changes, that is the first step and is certainly a good step. So we make a change and of course, we test it out on a demo account. We have done that and it has worked, so we jump straight back into a live account to put the changes to practice. This unfortunately may bring in new challenges, every change that you made on the demo account will have a subsequent effect on other aspects of your trading such as your risk management plan, so simply making that single change may well have messed up the rest of your trading plan, making things a little more complicated and it may not actually improve your overall results.

It is easy to change things with your strategy, but not every change is a good change. You can very easily make a change which makes things even worse. You need to have an understanding of what changes are needed to be made and also to have both the fortitude and the discipline in order to practice with the new changes and to gain the necessary information and knowledge that comes with them in order to effectively work out whether the new results are actually positive or negative. Many people simply stop halfway through their new testing because they do not feel like it is worth the time, or they do not have the understanding that these changes take time and will often need additional tweaks to them in order for them to be fully effective.

So in order to ensure that you are able to make these changes and to make them in an environment where you are safe and more importantly your account is safe, we do this in a number of different ways. The first is of course on a demo account, every single time that you make a change to your strategy, no matter how big or small, you need to look to test it out on a demo account. This allows you to try it over an extended period of time, in an almost live environment. You need to test it out for a long period of time, not just 4 or 5 trades. Use this opportunity to tweak things. The longer you practice with it, the better your understanding of how these changes have affected your overall trading plan.

The second is to simply review charts, this does not give you the hands-on and true trading feel, but it is vitally important. By reviewing the charts, it enables you to figure out what you could have done during the day and what you could have done differently. This is invaluable as it means that the next time that a similar setup appears, you will know exactly what it is that you need to do. It’s like a sports game, they watch back over the game afterward to find out what went wrong and what could be done differently, so the next time they come up against that opposition, they will be able to deal with the threats and the team a lot better. Do not be afraid to spend some time looking for what you need to do differently, your future self will thank you for it.

So those are two methods that you can use to help implement some change. Remember that change needs to happen slowly, but the most important thing is that change needs to happen. Do not sit there hoping the markets will come back, they won’t, they will simply punish you further. So think about what you need to change, get an understanding of it, and then implement it.

Beginners Forex Education Forex Basics

How to Become a Successful Forex Trader

Becoming a successful Forex trader is a great goal to have, although the intimidation of learning the ropes and investing real money into a trading account keeps many from even attempting to try. A good start is a key to later success when it comes to trading, but many traders don’t even know where to begin.

First, you need to understand that you aren’t going to become a successful trader overnight. It can take months and even years for traders to figure out which strategies work best for them and to tweak their routine to perfection. Once you’ve accepted that this will take time, you can get started with the following steps:

Educate yourself: Many beginners are eager to start trading from a real account, which leads them to make the mistake of opening an account before they’re ready. Within a week or two, those accounts are usually wiped clean and the person walks away from trading for good, thanks to their bad experience. This is why educating yourself beforehand is crucial. Start with basics, like terminology. Then you can move on to more difficult concepts like trading strategies, trading psychology, etc. Some brokers offer helpful educational resources directly on their websites for free, but the internet is also filled with articles that teach these subjects. If you have trouble with a specific subject, try looking for a YouTube video on the subject, or read an article that was written by a different writer. You can also trade from a demo account to get a feel of the live environment and to get a sense of how prepared you are. 

Choose a good broker: There are tons of brokers to choose from. Some offer low spreads, fee-free funding, bonuses, and other perks. However, there are far more scammers out there than there are good brokers. Don’t let this scare you – you’ll simply need to put some effort into conducting research to find the best, most legitimate broker possible. 

Only invest what you can afford to lose: Beginners shouldn’t feel pressured to deposit $300, $400, or more just because a broker doesn’t accept a lower deposit. Many brokers will allow you to open an account with just $5. Ideally, you’d want to invest more than that, but it’s a good idea to start out small. You don’t want to risk your life’s savings on a trading account, especially in the beginning. Figure out your maximum deposit limit and find a broker that can work with that. 

Develop your trading strategy with risk-management in mind: The internet can also be of great help with this step. A quick web search will pull up several different detailed trading plans, like the Breakout Strategy, Swing Trading, Scalping, and so on. Once you find a strategy you like, be sure to account for risk-management. Stop-loss limits and trailing stops are important when it comes to limiting losses. 

Keep a trading journal: Once you get started, it is a good idea to journal every trade that you make. Write down the reasons why you made the trade, the entry price, stop loss level, and so on. Be sure to note whether the trade was a winner or a loser as well. Having everything logged can help you to see how you’re performing overall and where changes might need to be made. 

Becoming a successful Forex trader is an achievable goal with time and dedication. Educating oneself thoroughly and researching risk-management methods and trading strategies are some of the most important steps that a beginner should take. Making smart investment choices is equally as important – it’s better to start out small when you’re just getting started. Once you’re ready, choosing a good broker, and keeping a trading journal will help on the road to success. If you’re reading this article, then you’re obviously considering becoming a Forex trader. Free educational resources are available all over the web, so there’s no reason not to get started right now!  

Beginners Forex Education Forex Basics

SMART Goals For Forex Trading

You have probably come across the term SMART goals before, it is used all over the world in pretty much every profession that you can think of. Why is it used so much? Simply because it works. SMART goals are a way of creating targets in a way that ensures that you will be able to achieve them and that you will be able to monitor them along the way. These sorts of goals can also be used when trading in order to plan and achieve your trading targets.

So what exactly are SMART goals and what does it stand for?

SMART is an acronym for setting goals it stands for :

S – Specific

M – Measurable

A – Achievable

R – Relevant

T – Time-bound

So now we know what the letters stand for, let’s look at what they mean.


The goal that you set needs to be both clear and specific, this enables you to focus on it fully and you will know exactly what you are aiming for, this can help to promote motivation towards achieving it. There area  few questions that you can ask yourself in order to work out what your specific goal should be:

  • What do we want to achieve?
  • Why is this goal important?
  • Who will be involved?
  • What resources or limits are there?

In relation to forex, this could be a specific goal aimed at achieving certain profits or profit levels, or to achieve the completion of a trading strategy with a certain win percentage.


The goal needs to be measurable, this will enable you to monitor and track the progress that you are making towards the target. Being able to monitor and assess the goal and your progress towards it will help keep you motivated towards achieving it. You can work out what your measurable goal would be by asking a few questions:

  • How much?
  • How many?
  • How will I know when I have achieved it?

In relation to reading, this could be related to the goal that we thought about above, if we are looking to achieve a certain percentage of profit or monetary value, then this is a measurable target, as we are able to measure our progress by looking at the current profit levels.


The goal that you set needs to be achievable, this basically means that it needs to be realistic, it needs to be something that you have the ability and the capacity to achieve, there is no point in setting a goal that is way too high, as you will never actually be able to achieve it. You can work out this section of the goal by thinking about:

  • How can I accomplish the goal?
  • How realistic is the goal based on my circumstances?

If we take the same example that we have been looking at, we want to achieve a certain profit percentage or monetary value. So what would we set this at If we have a starting balance of $1,000, there is no point setting a target of $1,000,000. While that would be very nice, it would be more realistic to set your initial goal as $2,000 or $5,000 at a push. Remember this needs to be something that you are able to achieve.


The goals that you set need to be relevant, they actually need to be related to what you are doing. It needs to be relevant to you, it needs to be of interest to you, there is no point having a goal that you aren’t interested in, or that won’t actually help you achieve anything in relation to the activity. You need to ask yourself a few questions:

  • Is it worthwhile?
  • Is this the right time for the target?
  • Am I the right person for this target?

Once again when we look at this in relation to trading, the target of gaining a monetary value is very relevant to the task and also our overall interests, wheat would not be relevant is something like gaining muscle mass while trading. That is a little extreme of an example, but you get the idea.


You can probably guess what this is referring to, it is all about having a timeline and an ending point at which point you wish to have achieved the goal, this could be a few days for a small target, or it could be a year away for a long term goal. What is important is that it remains realistic. You should ask yourself a few different questions:

  • When do I want it done?
  • What can I achieve in 6 months?
  • What can I achieve in 12 months?
  • What can I do today?

Looking at the same example that we have been using throughout, we want to gain a 100% profit on our account, $1,000 to $2,000. Is it realistic that we can do that by next week? It is possible, but not very lightly. What is more likely is that we can do it in 1 year, 12 months to achieve this goal. That seems realistic, so let’s put it down.

So as we went through the meaning, we kind of set out a SMART goal of our own, we want to double our account and go from $1,000 to $2,000 within a year. Is this goal specific? Yes, we know exactly what the target is. Is it measurable? Yes, we are able to see our account balance increase as it goes. Is it achievable? Certainly, we have a good strategy and it can definitely be done. Is it relevant? Yes, it is part of both trading and it is of interest to us. Finally, is it time-bound? Yes, we want to achieve it within 1 year.

Now that we have a goal, we can write it down, set up the method of measuring, and set ourselves on a path to achieving it.

SMART goals are a fantastic thing to set, both in trading and in pretty much everything that you do in life. It is certainly worth sitting down and setting some of these goals yourself, it will give you a lot of motivation seeing that progress is being made as you go along.

Chart Patterns

Forex Chart Patterns Might Be an Illusion

If you are new to forex trading, chart patterns are likely to attract your attention quickly because the trader community is full of praises for this kind of trading. They will certainly seem appealing due to habits developed from a young age when our parents used different shapes and forms to keep us entertained and amused. Nowadays, the entire toy industry and children based video games are based on shapes and forms used to provide preschool education to toddlers and children. Our brains are naturally wired to see patterns in every abstract form, be it star constellations or forex charts. We give meaning to randomness. Therefore, who could blame you for jumping on the chart pattern bandwagon once you enter the world of forex trading?

Indeed, some pattern names will easily trigger childhood memories that instantly attract you to explore more about pattern trading: triangle, wedge, rectangle, flag, and pennant. Some of them are appealing enough, such as head-n-shoulders or cup-n-handle. It just sounds like fun and games, and why not have some of it while trading. To make things more serious, most traders will tell you that it works and they will provide you with an abundance of examples. But the question is: have you learned to lose fun games when you were a kid?

The question is posed because there is not much information available on when chart patterns are not working. In reality, chart patterns supporters will show you examples when chart patterns have already worked but will rarely share the failed stories on using patterns that have completely misled them. The first instance would obviously create an image of a prominent trader, while the latter would discredit them and portray them as a showoff. Therefore, psychology plays a significant role in chart pattern trading as the availability of successful examples plays hand in hand with the trader’s inclination and ability to boost self-confidence. Reliance on the limited information that is available to the narrow circle of traders and a strong belief in skills that provide an advantage over the competition will eventually lead to overconfidence. Such a mindset represents a perfect stage for doubtless use of chart patterns as successful examples visible only in the aftermath is seen as an actual confirmation of self-confidence and perceived ingenuity. This fact is your first red flag when considering chart patterns as your go-to strategy in forex trading. 

It is also important to keep in mind that the overwhelming majority of traders are impressed by chart patterns, which is why new traders are attracted to this kind of trading. It is a classic example of social learning theory that can be summarized as the acquisition of new behaviors by noticing and imitating the behavior of others in the group. That same theory is proven in social experiments in which a random person not aware of the experiment is acting the same way as the group participating in the experiment, without even knowing the reasons for such behavior and regardless of how ridiculous that behavior may be. Simply put, chart patterns should not be utilized without any doubts just because the overwhelming majority is doing so, according to the contrarian traders’ opinion. This resonates as the second red flag especially if you put in the perspective that the majority of traders are on the losing end of the forex market. 

As a beginner, it is not easy to spot a forming shape when looking at charts. In fact, you have to draw it yourself and there are no clear instructions on how to do it. Line drawing can cause a lot of frustration, consume much of the precious time, and requires plenty of creativity. You are bound to make mistakes, redraw numerous lines and shapes and it still does not guarantee success. A good example that demonstrates drawing patterns is a matter of frustration rather than efficiency is drawing trend lines. As you may know already, traders analyze charts in numerous different manners and therefore see trend lines arising at different points. Therefore, your decision on breakouts and entry points will differ from other traders and chances are that the same is applicable to drawing chart patterns. There is simply no consistency in drawing patterns. When the first red flag is added to the equation, the fact that chart patterns work perfectly for others makes us question our own abilities and we quickly start blaming ourselves when the drawn patterns are not giving results.

Finally, it is not shapes and forms that move the prices but the big banks reacting to the retail traders. None of them are putting effort into creating triangles and wedges on the charts. On the contrary, they are bound to form eventually as a natural process of market movements. Their natural formation is not a clear indicator that prices are going to take a direction predicted by the pattern, despite the time amount invested in identifying the pattern. The reality is that the prices still have even odds of going one way or another, and there are more systematic ways to connect the dots that give us a higher chance of success than chart patterns.

Forex trading is not universal science and many different strategies and approaches could be used – and even developed – by traders. Those who develop unique trading systems based on evidence that demonstrate consistent results are more likely to achieve success, simply because they start to trust the process over time. In the process of building their exclusive trading system, traders develop a greater understanding of arising issues and use distinctive rationale thus dealing with market obscurities more effectively. Such traders do not waste time identifying and drawing shapes nor do they adjust their skills and knowledge to the chart pattern system that has not been empirically proven.

Although chart patterns are not supported by practical evidence that would confirm their (in)famous reputation, the red flags pointed out in this article represent just one school of thought. There is no need to change the system heavily relying on chart patterns that yield profits, as it certainly is a powerful tool for those traders who found the winning formula. Such traders may have a strong argument on using chart patterns; however, they cannot draw the lines and shapes for all the traders who just can’t get it right. And it is no surprise overwhelming majority struggles with chart patterns since there is more evidence available on why chart patterns do not work in practice. Once caught in its web, it is difficult for traders to break away from the habit of identifying shapes on the chart. Moreover, they tend to modify their systems and overthink when they spot a shape on the horizon. In an effort to avoid this trap, any trader should eventually pose the same question when getting lost with chart patterns: would I rather trust my own work and judgment or follow the signs along the way?

Beginners Forex Education Forex Basics

How to Successfully Trade Forex Part-Time

Forex trading can be a lucrative investment with knowledge and dedication, however, it’s no secret that you actually have to invest time into learning and trading if you want to make money doing it. For many of us working 9-5 jobs, taking care of children, or dealing with other responsibilities, it might seem like we’d never really find the time. This keeps a lot of people from even trying to trade because they have already decided that they wouldn’t be able to keep up. Fortunately, there is a possible solution for those that don’t have the time, or who may not want to spend hours trading every day. The solution would be trading part-time, rather than full-time. 

The great thing about forex trading is that you can set your own schedule, so there’s no reason why you couldn’t check your account in the morning, during a lunch break, or even in the evening after work. Even if you don’t work or attend school on an average 9-5 schedule, it’s possible to work trading around your daily agenda. This is the best solution for those that want to make a smart investment without quitting their regular jobs. After all, it takes a lot of experience and a significant investment to make enough money trading that you could quit your job. Part-time trading is like a middle-ground, where you can continue to bring in your guaranteed income while adding to it.

To take up forex trading, you’ll need to model your trading plan around the amount of time you have to trade and choose a strategy that doesn’t require constant attention. Swing trading is a good example of a low-maintenance strategy because traders typically place a medium or large trade and leave it open for days or even weeks to accumulate. One plus to using this type of strategy is that it fits in with the “less is more” mindset that many experts bring up about trading. It’s been said that trading less often is less dangerous and can actually make you more money in the long run. 

Those that are interested in part-time trading do need to understand ahead of time that it may take longer to actually get started if you have less time to invest in your education. Opening a trading account without being well-educated about trading is actually one of the top mistakes that beginners make. If you can, try to devote time on the weekends or spend more time in the evenings learning until you’re ready to open your trading account and make that first investment. Devising your trading plan and strategy will also take some time, but you shouldn’t let this dissuade you from trading. Once you’ve completed these tasks, you won’t have to devote as much time to trading and you’ll be able to sit back more and collect the profits from your efforts. 

In conclusion, those that are interested in part-time trading should take up the opportunity. It does require some time invested in learning beforehand, however, part-time traders can really take advantage of the flexible schedule that forex trading offers. This is one of the best ways to invest your money and to receive quick returns on that investment. We’ve often said that beginners shouldn’t rush to quit their day jobs to take up trading full-time, but part-time trading is a great middle-ground that allows you to keep your life the same while making money. Who could argue with that!

Beginners Forex Education Forex Basics

Trader’s Guide to Islamic Trading Accounts

An Islamic account or swap-free account is a special type of trading account that is offered by some forex brokers. These accounts were created to adhere to religious Islamic beliefs that prohibit the accrual of interest, meaning that Islamic traders cannot pay or receive interest rates. These accounts must respect these Islamic principles:

  • Payment or receipt of interest rates is prohibited
  • Exchanges must be executed immediately
  • Gambling is not allowed

Although Islamic accounts have many similarities to regular trading accounts, they do differ in some ways. For example, Islamic accounts cannot be charged swap fees for holding positions overnight, but some brokers might apply administration charges if a position is left open after a specified amount of time. Each broker has its own terms and conditions for its Islamic accounts and might offer different spreads, fees, or make other changes. Always be sure to read the terms and conditions for any account before making the decision to open one. You also might want to compare a broker’s Islamic account versus their regular trading accounts to make sure that there isn’t a big difference with spreads or other conditions. 

Finding a broker that offers Islamic or swap-free accounts is possible, but you should know that these accounts aren’t available with every forex broker, mainly because some brokers feel that they don’t make enough money through these accounts. If you’re trying to find out if a specific broker does offer them, start by checking out their ‘Account Types’ page and check out other areas of their website for information. If you can’t find any mention of an Islamic/swap-free account, try reaching out to ask support if this is offered before you move on to another option. Some brokers might require you to sign up for these accounts by speaking with an agent first and it’s common for proof of religion to be requested before an Islamic account can be opened. 

While Islamic/swap-free accounts can be beneficial to those that often leave positions open overnight, they are only meant for traders of the Islamic faith and you will have a hard time opening one without proof that this is your religion. If you are Muslim, then the good news is that you do have options to trade without breaking any religious guidelines related to interest charges, gambling, and so on. These account types have many similarities to traditional trading accounts, although the ways that fees are paid can differ so that the accounts are compliant with Muslim beliefs.

Forex Trade Types

What is Naked Forex Trading?

Naked Forex Trading, also known as price action trading, is the act of trading without using any indicators. Indicators are used to measure certain things about the market to help traders decide whether to enter a trade. Exchange rate, volume, or the open interest of a currency pair are common things that are measured by indicators. Many traders recommend that beginners start with naked trading before learning how to use indicators. 

Naked trading is based on the present market, not past or future performance. Learning price action is key here because it will help traders to figure out which way the market is going to move. Decisions are made solely based on the candlesticks or charts one is looking at. This is a simpler trading strategy and decisions can be made much quicker because there is less data to analyze. Many naked traders use support & resistance levels and trendlines for better confirmation that a trade should be made. It is also important for naked traders to understand market cycles:

  1. Ranging lows
  2. Trending upwards
  3. Ranging highs
  4. Trending downwards

This cycle tends to repeat itself. One common rule is that traders should always trade with the trend, never against it. Of course, you’ll also need a good understanding of candlestick patterns and what they mean before you adopt this strategy. There are two main chart patterns that you should recognize if you’re going to take up naked trading:

  1. Head and Shoulders: This is a common pattern that shows up quite often or about every day. It consists of two shoulders, which are lower highs, and a head, which is the highest point. This pattern suggests that an uptrend is about to reverse into a downtrend or vice versa. If you have an open position, this is a sign that you should sell before the market turns bearish. 
  2. Wedge Patterns (Also known as Triangle patterns): This pattern can signify different things in the market. It is a triangle with one long side followed by prices getting closer and closer together. The other two sides are drawn with trend lines. A breakout occurs when the price gets too close, resulting in either an uptrend or downtrend. 

One key benefit of this type of strategy is that it can help avoid the pesky analysis paralysis, which delays trading decisions because of information overload, resulting in delayed trading decisions, or the inability to decide altogether. Still, this strategy isn’t perfect. Naked trading tends to focus on technical analysis, which involves analyzing charts, without paying much attention to fundamental analysis. Traders still need to watch an economic calendar in case events will affect their trades. It may be more difficult to trade ranging markets with this strategy, although it isn’t impossible. It can also be difficult to recognize certain chart patterns and to get used to trading without indicators if you’ve used them before.

To sum things up, traders should know that naked trading is simply the act of trading without any indicators. Decisions are made by analyzing candlesticks or charts and this method is strongly based on technical analysis. While some traders prefer this simpler strategy, others may feel more confident trading with the help of indicators. All traders should understand how naked trading works before deciding whether this strategy might work for themselves.

Forex Psychology

Self-Improvement Steps for the Fearful Forex Trader

Forex traders are no stranger to the rollercoaster ride of emotions that come along with trading, as many have experienced excitement, greed, anxiety, anger, and even fear at some point in their careers. Today, we will focus on fear and how it can affect your trading decisions, along with some ways to cope with it. 

While trading, fear can come from the possibility of losing money, as you never know for sure if your trade is going to win. Some people feel this way at all times and are very careful about how much they risk, while others might only struggle with feeling fearful after taking one large loss or multiple small losses in a row. At this point, the trader is more likely to think of how much money that they have just lost and might even feel as though they are having bad luck. The fear then leads the trader to close their position too early, even though it was a valid trade that could have made more money. After a few hours, the price shoots up and the trader is left feeling angry with themselves for closing out the trade when they could have made more money. Sound familiar? Many of us have been there before.

So how do you deal with feelings of fear while trading and avoid closing out trades too early? Try following these steps:

Step #1: Identify Your Fear

First, you need to admit to yourself if you’re feeling uneasy and figure out why. Are you simply afraid to lose money in general, or has something made you feel this way? If you’ve been on a losing streak recently, this could be a contributing factor. A large loss could also make you feel more worrisome. Or perhaps you’re generally an anxious person that is feeling more on edge from normal trading emotions. Once you’ve confirmed that you are feeling fearful, remind yourself that this is a perfectly normal emotion in trading that can be dealt with.

Step #2: Don’t Let Fear Stop You

Once you know where your fear is coming from, you can think about the emotion more clearly. Say that you’re preparing to exit a trade. At this point, you should ask yourself if there are valid reasons to exit the trade, or if you only want to close out because you’re afraid of losing money. If it’s the latter – you need to stay in the trade until you have a reason to exit. Know that it’s ok to step away from your computer if you start feeling overly fearful or anxious in these moments, as a quick break can really help you calm down. Staying in the trade for longer is the option that is more likely to bring you in more money, as long as you have evidence that the trade will be successful. 

Step #3: Start a Trading Journal

It would be nice if every forex trader kept a trading journal, as these handy little record keepers can provide deep insight into what is going right or wrong with your trades. Sadly, a lot of traders don’t use a trading journal, or they might start out with one only to abandon it down the road. For those that have been feeling fearful and closing positions too early, it’s a great idea to either start a journal or to make sure you’re logging everything in detail in the one you have. As you work to deal with overcoming the fear you’re feeling, the journal will help you to see if you’re making improvements or stuck making the same mistakes.

Forex Psychology

Tips for Remaining Disciplined While Trading

Discipline is often listed as one of the most important traits that a successful forex trader should have. After all, without discipline, one is likely to make decisions based on their emotions and might not stick to a trading plan at all. This makes trading more like gambling and guarantees that success will be hard to come by. The disciplined trader has it all – they can keep their emotions in check (even after large losses or a bad day), they set a plan and follow it consistently, and they don’t spend time worrying about past mistakes. Instead, they learn from their mistakes and move on.

Of course, being a disciplined forex trader is easier said than done. Anyone who has traded before has likely felt a rush of emotions, considered deviating from their trading plan when the market was unpredictable, and they might have even thrown some of their self-imposed rules out the window. If you’ve been there before, then there are some things you can do to help yourself stay disciplined. 

Tip #1: Practice

Controlling your emotions can be difficult when money is on the line. This is why you need to practice keeping your cool in the beginning until it feels more natural. It’s normal to be more on edge in the beginning of your trading career, or perhaps after changing something about your trading plan or strategy. You can always start by practicing on a demo account to make yourself feel more confident about your plan or abilities – but be aware that a demo account can’t prepare you for the rollercoaster of emotions that come with trading. This is because a demo uses fake money, so while it might show you that your plan needs some work, it isn’t the best if you’re working on managing your emotions. When practicing on a real account, try taking smaller position sizes and risking less so that the emotional fallback is less if you lose money. Then, you can slowly work your way up to larger trades once you feel that you won’t take those losses to heart.

Tip #2: Critique Yourself

Go back and take a look at your results once you’ve been trading for a while. Have you made money or lost it? The best way to do this is to keep a trading journal and write in it religiously. This means you’ll log every trade you make and include details like how much you made or lost, the reasons why you entered or exited the trade, and so on. This helps you to understand your strengths and weaknesses and shows you where your strategies do and don’t work. Once you tweak your trading plan to perfection and have data that proves it is trustworthy, it will be easier to stick to it in the long run. 

Tip #3: Stop When You Need to

Sometimes, you might just need to stop trading altogether. This could be applied to two different situations; in the first, the market might just not be right for trading. They don’t say that it’s better to trade less for no reason, this saying actually has to do with the fact that traders come out better when they know when to sit out. If you force trades, you aren’t doing yourself any favors. The second scenario could come into place when your emotions are just too overwhelming and you can’t calm down. The best traders know that it’s ok to step away from your computer and take a breather if this happens, rather than to continue allowing yourself to make clouded trading decisions. Take as much time as you need to and come back once your level-headed. This will make it easier to stay true to your plans and strategies without making cost worthy mistakes like revenge trading.

Beginners Forex Education Forex Basics

Trading Bias or Actual Prediction?

Financial advisors or investment guides might have discussed the dangers of trading bias with you before. If not, you should know that a trading bias has to do with an investor making a trading decision based on preconceived ideas about what will or won’t work without taking the actual evidence into consideration. This is a psychological phenomenon that can negatively affect your trades, as someone that is making biased decisions does not carefully consider the real factors that could affect their trade.

The most common example of this issue is confirmation bias, in which an investor looks for evidence that specifically supports their preconceived idea. This would also involve actively ignoring signs that their idea is wrong and only looking at the evidence that makes it seem plausible. Another example would be sunk-cost bias, which occurs when an investor sinks a lot of time, money, and/or energy into an investment and refuses to cut their losses, even if it is obviously a bad move. Both examples can cause you to lose money.

If you want to avoid trading bias, the first place to start is by recognizing it. Think about the things that you look for when you decide what trades to enter and ensure that you are taking in all of that information, not only certain factors that support a preconceived idea. Consider technical analysis, which has to do with historical price movements on charts, or fundamental analysis, which analyzes economic, social, and political data. Both of these take real information into consideration and can be helpful if you’re trying to make more solid trading decisions.

The bottom line is that it is easy to fall into trading bias without even realizing you’re doing it. If you develop an idea of what will work and ignore information that suggests otherwise or refuse to pull out of a losing position after investing a lot of resources into it, then you’ve fallen victim to this problem. Once you realize this, you should think of the bigger picture as far as what you base your trading decisions off of. Remember to look at concrete facts that support your ideas without ignoring any red flags that suggest things could go another way. Also, don’t be afraid to pull out if the market is moving against you, otherwise, you will only increase your losses.

Forex Fundamental Analysis

Sentiment as the Key Factor In Decision-Making

Have you ever asked yourself what key factor has the power to substantially and irrevocably impact the trade of currencies? Many have tried to reach this answer and, at the same time, many have failed, dragging the weight of financial losses and blown accounts along. What makes a trader successful in the end? Are we to focus on the factors obstructing traders’ passages to growth or the ones facilitating the prospects of earning a profit? We now have access to countless sources offering volumes of educational material, but we still hurdle the same barriers that prevent us from becoming better traders. We have long learned about indicators, charts, and strategies, among other fundamental concepts introduced at the very beginning of our forex trading careers.

Unfortunately, most traders fail to grasp the one idea that has sparked so much controversy within the forex community by now that the focus on the results is often blurred and compromised by the traders’ specific sets of beliefs regarding what is right. The spot forex market enjoys a continuing influx of traders from a number of different markets, boldly attempting to tap into their previously acquired experience and knowledge and apply them onto the world of trading currencies. Combined with the less experienced traders’ rite of passage and poor choice of information sources, the overall failure rate is rather ominous. However, it appears that most losses increasingly deal with the topic of sentiment, which entails a wider set of believers and facts every trader must absolutely strive to understand. Due to the above-mentioned state of the market, it is high time that the debate over sentiment and its impact on traders’ success was dealt with once and for all.

Unlike any other market, the spot forex market is severely monitored and controlled by the big banks, such as Deutsche Bank, JP Morgan Chase, and HSBC, whose power to affect the market can turn a seemingly ideal plan into a bloodbath unless you understand how to approach this issue. While the big banks have the power to detect market activity, they cannot see your specific order. However, should you take the most popular market position, there is a high probability of undergoing some very painful financial losses. While we may not know the extent of tools the big banks’ use to maintain control and insight, every trader can also gather a vast pool of information on market activity by using the IG Client Sentiment Indicator ( or FXCM SSI (, which are charts showing where the focus of attention is. Moreover, owing to these two sources, we can tell whether traders are going long or short along with where the price went in the end. Interestingly enough, apart from sharing the same information regarding where the price is going, both banks and traders have a common goal – profit.

So, if you were to ask yourself what action they would take if they noticed great concentration in a specific area of the chart, what do you believe your answer would be? If you imagine that all traders decided to move net long on EUR, what would the big banks do: a) keep EUR long for an extended period of time, bestowing all traders with a nice financial reward; b) immediately take the currency’s price short, forcing the majority to exit their long trades at a loss; or, c) maintain EUR as it is, lure the traders going long even further only to “unexpectedly” take the currency short? Most traders get trapped because the banks will almost always choose the second or the third option and will do that repeatedly and consistently. The moment where most traders get confused is believing that they can outsmart the system, still not recognizing what needs to be done when the banks change the price from long to short here, so they keep dragging themselves deeper and deeper in the mud.

Now that we can see how reliance on sentiment plays out in the field, we need to address the right approach to surpassing this obstacle. First of all, whenever there is a high concentration of activity in one part of the chart, this should be a clear signal for every trader to start feeling alarmed. At this point, we need to forget the human tendency to conform and practice the contrarian approach. What this implies is that each trader should strive to recognize to which direction the majority is heading and refrain from following the mass. The basis of this attitude is neither disobedience nor rebellion, but the understanding that we have two distinctly different methods of trading in this $3—6 trillion market – the right and the wrong way. If all those traders spiraling out of control placed patience, money management, and trading psychology before relying on the wrong sources, the big banks’ impact would certainly not be as negative a factor as it is in these cases. If the big banks ever disappeared, there is a great chance that the nature of this market would entirely change, possibly even becoming similar to the stock market. It is important that traders stop feeling angry about their losses and start taking advantage of the existence of the big banks.

This further entails that concentrating on notions such as order books, expiration dates, etc. is entirely redundant for trading currencies. We may never exactly know how the big banks manage the spot forex market, but what we can do is acknowledge the phenomenon which occurs repetitively and decide what to do about it. It is high time traders stopped wondering why or how things happen and started to ponder what they can do individually to measure control in their own trading. We can accept the inevitability of outside influences, but, at the same time, we should use the information we can gather, notice similarities, and feel comfortable making difficult choices.

When we think about the core of the forex market, we cannot assume the existence of qualitative sameness, where trading currencies, stocks, or commodities are considered to be indistinguishable. In contrast to what some sources may say, terms such as supply and demand, herd mentality, buy low/sell high, and more have no impact on the quality of trading currencies and are, thus, potentially dangerous because of the increased probability of missing the point. The spot forex market essentially revolves around the need to think about the reasons why a particular price moves in a specific direction. Traders’ main task is not to apply a set list of tactics incorporated from other markets, but make sure that they stay off the banks’ radar as successfully as possible. By becoming part of the minority, you will increase wins and decrease losses – which the majority of traders running after reversals, for example, may never experience.

The majority of traders also use common and outdated tools (e.g. Japanese Candlesticks) which offer information visible to everyone, pushing large numbers of traders to react to the same signals and thus immediately drawing the attention of the big banks. What is more, even the choice of currencies can have an effect on the future of a trade. For example, USD is always in demand, making the pairs involving this currency always on the banks’ radar to a greater degree than in other cases, which is why caution is advised especially for beginners. Traders can early on also feel threatened by the news involving regulatory bodies taking action to limit traders’ freedom. Do not get frightened because you see some exorbitant amounts they charge in the media, because once broken down per trader, these amounts approximately turn out to be a day’s work. Overall, do not get distracted by methods which are inapplicable in trading currencies or news for that matter because what you never want to do is be the line moving in a completely opposite direction from where the money is going in the chart.

To become more knowledgeable about the impact of sentiment on trading in the spot market, you should consider exploring the IG Client Sentiment Index for education purposes. The tool has proved to be less useful when the price is consolidating, but the opportunity to see the overall movement will serve as an invaluable lesson. Detecting whether traders are going long or short and where the price is actually going will almost always show you that the currency will more often than not go in the opposite direction, serving as an obvious confirmation of why going with the majority is never a good idea. Unlike with the USD-based pairs where such phenomenon frequently occurs, other currencies may vary in the degree of susceptibility to the big banks’ involvement simply because the number of individuals trading these other currencies is lower.

The first image below, for example, successfully captures how the individuals trading on the EUR/USD currency pair behave, transparently documenting this common occurrence. As you can see at the beginning of the chart, each time traders are impatiently moving from net short to net long, the price will almost always start moving towards the opposite direction. The chart further shows how traders at one point changed their minds for a short while, causing the price to react. Then they decided to go long, after which the price started going short and the two lines once again crossed paths going into entirely opposite directions. The same coordinated behavior is present everywhere in the chart, which should serve as an indication of the need to take a different approach.

Example of how the price rebounds depending on where the majority of traders are going

Sentiment, as we already explained above, is not equally applicable to all currencies. If you are interested in a currency pair which does not involve USD, such as EUR/GBP, you would then need to look for the combination of information you can gather from both the EUR/USD and GBP/USD currency pairs, focusing on where most traders are in these charts. Likewise, client sentiment may be applicable to some markets, such as the spot forex market, but there are certain exceptions. For example, precious metals rarely exhibit any correlation in this regard. If you are trading spot gold against USD, for instance, you should know that the banks certainly have control over the currency, but they have practically no dominance over gold. In this case, it is the price of gold that has a say and determines what will happen to that pair. Therefore, banks cannot truly manipulate the prices the way they would normally do in each and every case.

The involvement of banks becomes even more questionable when we observe some other trades, such as the one involving silver, as shown below. In terms of the stock market, we can find no evidence of sentiment influencing individuals stocks; however, certain indices prove not to be impervious to this phenomenon. While the IG Client Sentiment is practically the most heavily traded index we know, you may still use some smaller versions such as the CAC or the XETRA DAX. Despite the fact that the information will probably not be the same quality as with the most popular sentiment index, you will still be able to find some useful data. Most importantly, even with these less versatile indices, you can generally obtain the information on where the majority of people are unless you are looking into precious metals or crypto markets where you will find no correlation, further raising the question of why such data is even provided on these platforms. Unfortunately, such terrible fundamental mistakes keep happening, but it appears that the vast number of these traders choose not to open their eyes, thus giving the big banks the opportunity to cream off the profit so easily.

Traders must become aware of another essential difference regarding their approach to sentiment. As it appears, many traders keep falling for the same trap, believing that the only important matter in getting off the big banks’ radar is knowing the direction where everyone is heading to and opting to go the opposite way. What is more, they typically wait for the lines to cross or colors to change to make their move, using the IG Client Sentiment as a trend confirmation indicator. Unfortunately, no matter which pair you may choose to trade, using the IG Client Sentiment as a trend confirmation indicator will probably not give you the result you are looking for. Even if you put effort into finding ways how to use this tool more effectively, testing out every possible option, you should know that the knowledge about where the majority of traders are at a certain point in the chart is not the type of information you should be focusing on.

What is truly relevant is the insight into where these individuals are going, and where the mass is headed is where you will see the most appalling scenarios. You could most definitely benefit even more from some other indicators, which could be of more assistance to your trades. However, be mindful of the fact that even if you get a signal to go where the majority is at a particular moment, you should not feel worried. If the majority of traders are going long and your signal is telling you to go long as well, do not give in to the fear, but rest assured knowing that the concentration of traders in one place is not truly what you should be concerned about, but the direction they are taking. If you are wearing yourself down, distrusting the indicators you chose to serve you in your trading, you will very likely miss out on some extremely good opportunities. The best solution to this challenge is building your own algorithm and learning to trust that system.

A lot of sources discuss what constitutes the very essence of trading in the spot forex market. Especially for beginners, the access to sources attaching the same value to sentiment as to technical analysis and fundamental analysis can be utterly detrimental. This, however, does not undermine the impact of sentiment nor does it strive to prove how sentiment is unimportant, being the key driver in this market with the ability to move prices towards specific directions. The biggest problem traders have in dealing with sentiments is the fact there is little we can do about it. Chasing sentiments is simply equal to trying to predict the whims of people hungry for success. We cannot control people’s emotions or use them to foresee where millions of traders are going to go because it is an attempt to control the uncontrollable.

Since the greatest portion of traders keeps chasing the sentiment, your task is to do exactly the opposite. By eliminating sentiment from the equation, you will save yourself from facing scenarios such as the one in the image below. Not all places in this chart indicate the exact phenomenon we discussed today, but from the middle towards the right end, we see several places where most traders made one big move only to see the money go in the opposite direction. Nonetheless, the belief that just because millions of traders are going long at a specific time, we should go short is also an example of a short-sighted approach. We may not have control over people’s sentiments, but we can most definitely strive to learn about indicators, testing different tools, and working towards setting up our own algorithm.

Such knowledge could have helped traders who got caught up in the situation shown in the chart below because just by refocusing on the two lines where the white pointer is, they could have caught the big move and salvaged their trade. In addition to building up knowledge on trading and indicators, traders must bear in mind that indicators are result-oriented tools which are not truly meant to predict the future. Considering the fact that news inevitably gets in the way at some point (e.g. what the past year’s flash crash did to indicators), traders need to adopt skills that can raise them above the level of sentiments and provide some stability in this seemingly unpredictable market.

If you still believe that you can yield the power of sentiments, although generally not advisable, there is one method in which you can attempt to do it. Before using IG Client Sentiment, traders relied on the SSI indicator developed by FXCM, an ex-U.S. company that, unlike now, used to have more presence on MT4. Despite the fact that it does not make its applications available for U.S. customers, FXCM does have extremely useful products showing sentiment that you include in your chart. They also have their own proprietary trading software done in a different code, which you might still be able to use if you can transpose indicators from one language to another. If this is not the case, you may still find an easier solution by following FXCM Market Data on Twitter, which will offer a window into the actual SSI Indicator even if you do not have access to it.

Some of the benefits it provides include the GBP/JPY pair which we cannot find on IG Client Sentiment. This particular twitter feed is excellent at showing you charts that are relevant at that point in time. For example, the cropped image on the left below shows a chart revealing some unexpected activity, which tells us that there is a slight chance that the sentiment is about to reverse. Quite similarly, the AUD/JPY chart next to it with the yellow pointer indicates the crucial moment where any trader trying to catch a reversal would severely endanger their trading accounts and financial stability. Therefore, we must be particularly careful with this tool, whose greatest contribution to the forex community is the ability to use it as a reflection tool. Attempting to use it for prediction purposes, hoping to discover where the price might go, would require the understanding that a set-up algorithm would tell you much better where to go and what to do.

Overall, predicting the whims and the sentiments of millions of traders around the world has never been a good idea, and you must be extremely cautious when dealing with this topic so as not to end up where the majority does. Should you ever notice any extremes with regard to sentiments on the pair you are trading at the time, you are advised to stop and exit the trade. A great example of a situation where closing up was necessary was the 2019 flash crash, when the ratio between short and long traders on the USD/CAD currency pair was 4:1 (i.e. 80% short) because of which we could safely conclude that the price could not have gone much higher. Some experts who traded on this currency pair at the time state that they relied on their experience, leaving the trade just before their indicator was about to exit the trade itself. Nonetheless, until you are certain that you have enough knowledge, the right mindset, and necessary experience, do not let yourself get carried away, potentially endangering not just one trade but your entire forex trading career.

We could not stress enough how volatile relying on sentiments is, but if you really must proceed on such a trade in that manner, make sure that you use all the available resources. Twitter, for example, is a tremendous source of information, and taking notes is an excellent way to both memorize quickly and keep important data in one place. You can explore updates about IG Client Sentiment Index on DailyFXTeam, learn about additional SSI currency pairs on FXCM_MarketData, or discover some invaluable educational materials and market comments on This_IS_VP4X. If you are intent on growing as a forex trader, aim to include technical indicators, money management, and trade psychology into trading, which will essentially help you put a system together that will bring you money in the long run. What most traders, whom you could see in the charts added in this article, did was miss out on invaluable opportunities because they never put any effort into building a proper system.

Once you develop trading skills and reach the professional level, you may not need to use your own money to trade any longer because you will surely be noticed by different companies that will want to invest in you. Before that happens, you should start acknowledging the role of the big banks in this market and, if needed, let go of all strategies used previously in some other markets. Even though the phenomenon we analyzed today does not frequently happen in the precious metals or crypto markets, making use of techniques and indicators specific for the spot forex market will alleviate the external impact and safeguard you from any market instability. Moreover, understand that with forex, there are no shortcuts and that you have set yourself up for a long road of learning and growing.

Luckily, today’s article equipped you with the knowledge some individuals who have been trading for more than five years still do not know. You should now be able to avoid areas in charts that are open to manipulation and preserve your finances, which will be further fortified by not trading reversals or using the same common tools as every other trader does. Finally remember that your only chance to succeed is by getting out of the pool of traders who focus on the sentiments, as it is key in differentiating between emotion-driven and indicator-driven individuals. Building a currency trading career based on emotions, bereft of any technical skills, is not a long-term strategy, and if you are passionate about trading in the spot forex market, eliminating sentiments and devising an algorithm will get you right from where you are to being a professional trader.

Forex Basics

What’s the Deal With Forex Influencers?

If you have been around on social media for more than a few minutes you have probably seen the vast numbers of people who are showing off their expensive houses, their flash cars, and more often than not, piles of money. So how have they got these things, how long did it take them, and more importantly, are they even real?

An influencer is classed as someone who has a large following and is able to make movements within a market by recommending a product or asking people to perform certain tasks. There are some very legitimate influencers out there, who have worked hard and have made themselves a success. However, three or a lot of people who have seen this and tried to fake it, the old phrase of fake it till you make it is relevant here. So we are now going to have a look at ways that you may be able to work out whether someone is a real influencer or a faker.

Their Age

One thing you need to look at is their age, would you believe an 18-year-old (or sometimes even younger) that they have made millions trading, considering that you are required to be 18 to actually trade, we find it hard to believe that they have already managed to make millions. While there are of course those that are 18 who are millionaires, either through inheritance or businesses, it is far less likely that those posting on social media about their fortunes, especially showing them off in the form of piles of cash are real.

Duplicate Photos

It is absolutely fine to post the same picture on your account several times, what you do need to look out for though is those that are posting pictures from other accounts. If someone has millions of pounds, why would they need to be taking photos from other accounts instead of taking it themselves? What is even worse, is that a lot of these so-called influencers may have been taking photos from places like Google. If you are ever feeling like something could be fake, simply download the photo, go to google images and do a reverse search. If it is real there may be only one photo (or a few if others have copied it), but when you have a fake, there may be hundreds of them and it may well have been taken from another site completely.

Ridiculous Claims

I am sure you have seen some of the claims that they are making, send us $500 and within 7 days you will have $5,000 or for just 0.0001 BTC you will get 1 BTC in 2 weeks. That would be fantastic wouldn’t it, well this simply means that they are not real and are just looking to take your money. Please never ever send money to anyone on social media, there is never a need for it, even a professional account manager will not ask you to send them money directly or to a random crypto wallet, so if it looks too good to be true, it most certainly is.

Follower/Like ratios

This can be an obvious one, does someone have 10,000 followers but only 1 or 2 likes? Or do they have 10,000 likes and only a few hundred followers? Often those that are trying to fake it till purchase followers or likes, they do it to make it look like they are popular and that they have a following, mainly because if a lot of people follow you, it makes you seem a lot more relevant and genuine. Simply take a look at their profiles, their posts and their likes and you will certainly see some discrepancies if they aren’t the real deal.

The Fake Hours and Cars

There are some beautiful houses out there, and a lot of people on Instagram and Facebook seem to own them. In fact, we are pretty sure that a lot of them live in the same house. Those that are faking it aren’t buying these houses, they are simply renting them for the day and taking photos, it’s the reason why they often have the same weather and lighting in every photo. Just be wary of those posting huge houses with very little evidence of how they got it.

Some are Real

Of course, there are some people that have made this money or the popular ones that aren’t throwing their cash about, they do exist. If people are posting genuine content along with their fortunes, they could be more real than the rest. Those posting courses that they run are often quite knowledgeable, however not all. Often those offering genuine services will have a business with reviews online, be sure to check them out before ever departing with any of your own money. A lot of the legitimately rich people would have made their money through MLM schemes, recruiting others, so this is another thing to look out for.

So those are just a few of the ways to work out whether an influencer is real or fake, it is important to note that the vast majority of the people on social media are simply trying to make money off you, so stay alert and keep your wits in order to avoid falling into their traps. There are the real ones, but they are far and few between, so be careful when looking for people to follow.

Forex Psychology

Are You Guilty of Trading Bias?

Biases can have an effect on anything in life, from the food you wat, the places you visit, and when we are looking at Forex, the trades you take, and the reasons behind them. We have looked at some of the more common biases that you find within the Forex trading world.

Confirmation Bias

This is something that you get in any industry, you see it most often on the internet or during an argument where someone will come up with an idea that sounds a little far fetched, they will then look over the internet to find sources of information that match what they have said while looking for evidence is good, it’s not when you skip over 10 different pieces of information that counter yours, just to find the one that confirms it.

The exact same thing can happen in trading, you have done a little bit of your own analysis and come to a conclusion, so you want to confirm it with others, when you look online for it, you will automatically be looking for analysis that is the same, so if you thought something was bearish, you will be looking for bearish information online, even your search may contain that exact word. So you may find an article that matches yours, but the 10 articles around it may state that the market is bullish, ignoring those counter-arguments can cause an increase in losses. Looking for unbiased analysis is the best way to go, although we know it can be quite difficult to find.

Herding Bias

This is often referred to as a Sheep mentality, have you ever found yourself doing something simply because other people are? If a Sheep decides t ogo somewhere, another may follow, then another and another until the entire herd is doing that action or going t that place, that is where the term sheep mentality comes from.

This behaviour can be seen in trading too, if the majority of people are going long, then it is far more likely that the next person to come along will also go long, then the next and then the next. It’s natural to think that if the majority are going one way, they must know something, but this is not the case. You have done your analysis, it all points to a short position, so take that short position, why did you waste all that time just to be persuaded by a group of people, most of which most likely did not actually research anything. Take the trade the way you analysed it, if it’s wrong, then you can learn from that mistake through your journal, but if you go long because everyone else did, you learn nothing as you do not actually know why you took the trade in that direction.

Attribution Bias

This is all about what you feel is responsible for a loss or a win, when we look at trading, when we win, we often congratulate ourselves on a great trade, we analysed things well and it paid off. When it goes wrong, who is to blame? It was what Trump said, it was a freak movement in the markets, it was anything but me that caused it.

It is very natural for humans to want to blame someone or something else for their misfortune, however, it is important to be able to look at something without this bias, being able to determine exactly where the trade went wrong, and what you did wrong is one of the best opportunities that you have agave to learn. Simply putting it down to an uncontrollable outside force does not teach you anything, it does not help you to adapt and it does not help you with becoming a more profitable trader.

Addiction Bias

This one is all based around excitement, the thrill of getting a big win, the idea of getting a big win. Our minds will always want to retain memories of those most exciting trades and the ones that made us the most money. This can often lead to something called an addiction bias, where we want to try and recreate that exciting experience. Having that huge trade in the back of your mind can make you break out of your sensible strategy in order to put on a larger trade to try and recreate that feeling, this is never a good idea, it goes against your risk management and into a territory of trade that is outside of your strategy, making it harder to predict and a lot more dangerous for your account. Use those large trades as a reminder of what you can achieve, but do not try to fast track yourself to that outcome.

Recency Bias

This is about thinking about the most recent thing that has happened and making decisions based on that one event, rather than looking at things as a whole. This can be quite prevalent with news traders, especially now Trump is the president. If there are a number of news events coming up for USD, the overall markets are bullish at the moment, the most analysis points to a bullish movement, the news comes out and it is negative (bearish). What do you do? You put on a sell because the news can move the markets down, but, nothing happens, it continues to rise, why? The reason is that the markets are still bullish, one bit of news won’t change that, you have looked at the most recent event to happen and ignored everything else. You need to maintain a view of the entire picture, not just the most recent even to happen.

So, those are some of the biases that we see both in life and in trading, are you guilty of them? I know I have been, it’s ok to have these biases, what is important is that you are able to identify them, and then work on avoiding them in the future.

Forex Psychology

How to Successfully Avoid Trader’s Regret

Have you ever made a purchase and then instantly regretted it? Wondered why you just spent that money on whatever it is that you purchased? It has happened to all of us, it is called “Buyers Regret” and it is something that everyone experiences. It is the feeling of regretting the fact that you just spent this money on something and it happens more often the more expensive than an item is.

This same feeling can happen to traders in the form of “traders Regret”, it works much the same way and can have potentially devastating effects on both a trader’s account and also the trader themself. This feeling comes simply by the fact that you are risking your own money when trading, each and every trade that you make is a potential loss and will potentially cost you that money, this can lead to a few different things.

First, let’s look at what sort of trades can often cause this, we all should have our strategy and trading plan in place if you stick to it, it is far more likely that you will not experience this very strong emotion. However, if you have been listening to others and placing trades based on something you have seen or heard then as soon as you make that trade, you may wonder why you have done it. The same feeling can happen when you decide to step out of the comfort zone of your training strategy, as soon as you place that trade, you know that you have moved away from your strategy and put your account in some additional risk.

The feeling can also come when you have done nothing wrong, this is more obvious for those that are risk-averse if you do not like risk, then placing any sort of trade which adds an element of risk will potentially cause traders regret, this feeling can actually make it far harder to place trades in the future as the feelings that you had can linger in the back of your mind for quite a while.

The problem with traders’ regret is the fear that it can cause, it can make it far harder to make additional trades, it can prevent you from wanting to have that feeling again and so you begin to miss great trading opportunities, even those that are fully in line with your strategy and trading plan. Sadly, sometimes traders’ regret can get the better of you, as soon as that trade is open, you get the feeling and close it for a small loss, the trade can then go on to win. The next trade, it’s the same feeling and so you close it again, this can continue for quite a while. Most people will look at that and think that you probably shouldn’t be trading, this is not the case, what is needed is for you to work out a way to get over this feeling.

So let’s think about ways that we can help to avoid this feeling or to at least reduce it once a trade has been opened. The first thing that you need to do is to set up a trading journal, this is something that you can use to write down every trade and every decision that you make. This is perfect for reviewing our trades, and can also be a deterrent for traders’ regret, mainly because when you are worried about something you can look back at your previous trades to see why they were taken which can give you more confidence in the ones you are now making.

Having a solid trading plan can also help, if you have done the analysis and it is fully in line with your strategy then there should not be anything to fear. Knowing that proper analysis has taken place and that it is your decision should help alleviate some of the anxiety once the trade has been opened. This is a far better way of managing your trades when compared to copying trades that others have suggested.

While it may not be a good way to reduce the anxiety, a way of avoiding the potential of closing trades early is to simply input a stop loss and a take profit, place the trade and then walk away, leave the trading terminal, let it do its thing If you are not near the platform then you cannot close it, it will allow your strategy do what it was designed to do, after a while of doing this you will come to realise that your strategy is working, using itis giving you overall good trades, so it will help to alleviate some of the anxieties around placing trades.

Traders’ regret is a big thing, it can be very damaging, doing what you want to alleviate the feeling is important, it can take time, a lot of time, but the more confident you are with your strategy and trading plan, the easier it will be to avoid this very strong feeling of regret. In the end, you need to try and ignore the feeling and just make that trade.

Beginners Forex Education Forex Basics

Should Forex Trading Be Fun?

There are a number of different arguments going around as to whether trading should be fun, some seem to think that you should be concentrating and being serious the whole time, others feel that you need to enjoy something that you are going to be a lot of. There are pros and cons to both of those arguments and the truth is that there are times when it should be fun, and times when it should be taken seriously. So when do you know when you should be doing what and should you be having fun when trading?

There are a number of different stages to trading and the development of a plan and your trading mentality, these different stages often have different emotions that come with them. If we look at when you just started out, you are probably having a lot more fun, things are new to you, they are exciting, so you want to enjoy this stage in your trading career. It is a time when you are able to experiment in order to find what works for you, and this experimentation can be the most fun that you will have with trading, there are far fewer rules, and you are free to do what you want. However, it is important that you do not get carried away with it, and you should certainly be doing this on a demo account and nota live account.

This is also the stage when you may start to look for some guidance, how this goes will depend entirely on the sort of trainer or mentor that you decide to use. There Are some that are very light-hearted, allowing for mistakes and having fun and banter along the way, then there are the more serious ones, they are not there to have fun, they are there to make money and will expect you to have the same mentality. If you chose this sort of trainer then you will be expected to work hard and not simply mess about finding your feet.

This brings us to the second phase of your trading planning. This is where you are going to be creating your actual plan, for many this is the least fun and least exciting part of trading, yet others find it fascinating as this is going to define everything that you will be doing going forward. This is where there needs to be a lot more focus, you need to be able to decide with some conviction what you are going to be doing, messing about and just having fun in this stage could cause a lot of issues in the future, so you will need to buckle down, even if it does feel a little boring and tedious to do.

So the final stage of your trading plan and mindset is basically looking to always improve and to master your own strategy while working on this, it will take a lot of hard work, there will be many ups and downs, but what is important is that you remain consistent and that you develop discipline in order to remain on track and hopefully profitable. At this stage of your trading career, it won’t necessarily be the most exciting or the most fun, you will be going through a routine, which a lot of people often find a little boring, so while the trading may not be fun, the results certainly can be.

When we talk about results, we are of course referring to the potential profits that you can now be made using these on things that bring you happiness or to pay off bills which gives you some financial freedom. This is the part of trading that most enjoy the most and this is the result of your hard work beforehand. All those not so fun things you had to do and not so fun nights are finally starting to pay off and you will be able to have some fun with your trading.

Of course, for many, the actual trading is not necessarily fun, just the rewards are. However, for many traders, the actual trading can also be a great aspect to it, if this is you, then trading could be the perfect thing for you. If you enjoy the hard work, the numbers, and the creation of a strategy, then trading certainly can be all fun for you, but you still need to understand that there will be times where you need to step away from the fun and to be a little more serious.

One way that you can look at trading is in a similar way that you do to an elite athlete, they are required to put in a lot of work, a lot of work that may not actually be that enjoyable, while some athletes may like running laps, many do not, but hey know that they are required to do it if they want to be the best and if they want to make their living. Trading is much the same, you need to put that work in, you need to practice your strategy over and over until you have perfected it, but once you have done that, you will begin to see the rewards and it will all be worth it and you will finally begin to enjoy your trading.

Forex Basic Strategies

A Different Heikin Ashi Strategy – Trend Exit Guide

Most traders initially rely on what they hear, read, or otherwise find to be useful and informative, especially due to the enabling nature of this age of information exchange and media saturation. More often than not, these pieces of data prove to be half-truths, if not worse, and such a lack of skills and knowledge is then easily transferred across the global forex market. Due to the unrestricted access to partial, non-factual information, traders absorb too many fallacies, especially when these are related to indicators and strategies to earn a bigger profit. The same goes for the widely praised Bollinger Bands and Fibonacci, among others, which are some of the oldest and the most outdated tools that numerous sources still glorify despite their age and poor performance.

Some other tools and topics are simply copied from one source to another without much creativity and personal input. Nowadays we have heaps of materials with no innovative additions, which may not necessarily involve any new creation except for an original perspective. In this article, we will attempt to provide a fresh outlook on another popular topic from the world of forex trading – Heikin Ashi trading strategy. Also, this is just one example and opinion based on one group of professional technical swing traders, you can interpret the information the way you see fit.

Heikin Ashi is often perceived as one of the most basic indicators under the MT4 group, which another reason why some professional traders question its quality. In addition to being similar to another well-known indicator, Japanese Candlesticks, its name actually originates from Japanese and it translates as an average bar. Beginners mostly find it extremely useful because it makes finding the trade entry considerably easier. However, most available sources provide an insufficient amount of data as well as to abound in the lack of the right tips that can help traders earn a profit. It is common knowledge that, as with other similar indicators, Heikin Ashi offers two distinct candles, where the white candle suggests that a trader should go long, while the red one implies the opposite. Despite its simplicity, traders are not given an opportunity to make any settings adjustments, which additionally reduces the quality of this tool.

Furthermore, this indicator is so easy to see that everyone can see the same signals at any location on the planet, thus stripping you of the exclusivity that naturally comes with using a good indicator. Bearing all these facts in mind, any individual at any point in their forex trading carrier must be aware that simplicity and popularity do not necessarily equal supreme quality.

Regardless of this tool’s shortcomings, we should strive to be objective and provide a clear list of actions which traders should avoid if they decide to use Heikin Ashi. Firstly, traders should not use this indicator to enter trades because the number of losses is almost always higher than the number of gains. As we already said that Heikin Ashi is generally favored for its ease of use, beginners, as well as all other traders, should attempt to do a demo trade and see this for themselves. It is extremely easy to get excited while using this indicator early on, but using it to enter or even exit a trade will only make you feel more frustrated and incompetent at trading in this market. Moreover, Heikin Ashi’s candles function in an entirely different way from the regular forex candles we are used to seeing.

If you take a look at the image below, you will surely see a few prominent reversals in the chart (marked grey). These inviting points are precisely the places where you should remain focused just because most people fail to grasp the severity of entering a trade in between the grey areas (marked yellow). By measuring how trading, in this case, would turn out in advance, you could in fact understand that your price would probably never reach your take profit. What is more, before you could even see any profit from such a trade, you would probably need to go through more than a few losses, and no success afterward would be able to compensate for the degree of loss you previously experienced. Therefore, if you only allow yourself to see the surface and feel compelled to enter a trade only because of some superficial positives, you may lose all your confidence and severely endanger your financial stability as a result.

While we owe it to ourselves to call a spade a spade, this indicator can still offer some value, which other sources do not seem to be interested in. To be able to extract any such benefits from Heikin Ashi, you primarily need to be a trend trader using your own system. To manage a win, you will take half of your trade off after a certain number of pips and your move stop loss to the break-even. In case you have yet to discover an exit indicator you would prefer to use, Heikin Ashi can temporarily assist you with the rest of your trade. Simply put, if a trader is already going short, they will have to wait for the candle to become white to exit and vice versa. This indicator is not the best tool you could use to finalize a trade, but it certainly can be of great assistance if a trader has not decided on a specific exit indicator yet.

In comparison to not using an indicator to end a trade, Heikin Ashi can definitely render more pips and thus bring you more money than the other way would. However, if you already have an exit indicator you like or you are exploring your options, you can always use Heikin Ashi to compare the results it gives you to the ones your indicator of choice produces. It this comparison demonstrates any advantage of Heikin Ashi over the other indicator, you will know to continue looking for a better tool. This approach will save you much time and help you develop a safe and functional system you can rely on.

We know how important having a good algorithm is and Heikin Ashi can not only help you discover a good exit indicator, but it can also yield a great number of pips, even to beginners. Nevertheless, earning a few coins here should not stop you from looking further for an excellent tool that can bring even more success to your account. Keep searching for trend indicators and do not give in to passing compulsions that this indicator entails on the surface level. Avoid reversal trading and strive to see the entire chart as a whole measuring possible wins and losses and demo trading to compare. You can truly stand out from the crowd by learning how to differentiate between acting upon a feeling and making decisions based on some tangible data.

Do not be misguided by a vast number of sources promoting price levels, support/resistance lines, and other ineffective strategies that will not get you in or out of a trade on time or without losing a substantial amount of money. With a clear strategy, a trading mindset, and an effective exit indicator, you can get to wherever you want to be and Heikin Ashi can serve as a transitioning step on the way to reaching your goals. Finally, understand that all the time you invest in learning about Heikin Ashi and other indicators, testing, and making necessary comparisons will only help you grow as a trader for these are the skills you will always be able to call upon in the future.

Beginners Forex Education Forex Basics

Can We Still Be Successful with Bad Tools?

Everybody has a different opinion on how forex works and how exactly we should trade. There will always be some group of people that take issue with the things are said and done. We will always be surrounded by people who tend to discredit certain strategies. With something complex as forex is there will always be expressions of disapproval. We like to say that there are 2 types of people who really stick out in the trading parliament. Those are complainers and arguers. With complainers is simple, if we don’t do and say things exactly the way they want, then they are going to take the issue with it. With these kinds of people, disagreement will be the most possible outcome. Life goes on.

With arguers is much different, here we have just people with a contrasting opinion which is perfectly fine. In the end, we are all trying to figure out what is happening in the market, the world economy, and how big banks are affecting our trading. If we ask 1000 people the same question we would probably get 1000 different answers on the same topic, it’s just like that and that is how is going to be in most cases. So the best thing we can do is to give our own opinion after the research and try to back it up as much as we can. Constant pursuit for a better understanding of how forex works behind the scenes should always be one of our main goals.

Is it still possible to ride on big waves even if we use bad tools? There can be some winnings for sure, but it would be a lot more difficult to trade with bad tools. Because at their core these are sub-standard tools to use and by using them we would certainly have an uphill battle ahead of us. There have been a lot of traders that still became professional traders despite this fact. Even with sub-standard tools if our trading strategy is in place we might do some damage. The traders with good money structures who have their emotions well-settled might do good even with wrong tools. Way too often the game is over before even starts because some of us might be using terrible, outdated technical tools on our chart. But even with the almost perfect money-making algorithm, there is a big chance for messing up if we don’t have good trading psychology and adequate money management.

Surely there are tools and indicators invented a long time ago so we can reasonably assume they were not made for the market that we trade. They are certainly not the only options among more than 10.000 indicators and tools that we could put on a chart at any given time. There is no need to be trapped using the same tools if they don’t do the job as they should. We want to keep our chances as higher as possible and honestly, we are not going to score with outdated tools. We should always try to eliminate a lot of stuff before we can even think about moving forward but following the same tired advice, the same tired old technical tools being used every time is not going to get us anywhere. We need to be aware which tools could be totally useless for our trading and that we might be way better without some of them. Also, we need to distinguish which parts of some potentially bad tools we could actually use because there are tools with the most parts that we could not declare as beneficial.

There is a whole new horizon of indicators out there so just by being aware of their existence could put us in a very exclusive company. Most people, even professionals don’t know that there is a whole new world out there. Depending on a different type of tool or indicator that we are discussing, all types of arguments are falling into a few categories. Firstly, people like to say: “Well my friend, you just didn’t use it in this setting, that’s what you have to do”. Our response on that would be that the chances are we did try on that setting because of our through nature of approaching to forex and it didn’t just work for us. If something works for someone else that’s great but systems are different like we all know. If someone has a success in the particular setting then that somebody has figured something out. We always like to give applauses of admiration for those who manage to discover something revolutionary. Friends traders, please do share.

We have people typically connected to the Fibonacci tool. The Fibonacci crowd might say: “Oh you are just not using it this way, maybe you should try this method…” or “If you use the Fibonacci from an intraday stand of point it will work better”. Well, some don’t trade intraday because they have great success with the daily chart and that would usually be one of the main ingredients for the right way of trading forex as we like to point out. Still, it may not be for everyone. Further, there have to be at least 50 different ways we could use the Fibonacci in our trading like there are a lot of different ways we could use a bunch of other tools and indicators. The problem is that the explanation of any of those deserves a book or two. We could often see similar arguments when we debate about other tools. But all we care about here should be our personal success, no matter which tools took us there.

If somebody found a way to make a bunch of pips consistently, for example, using the RSI we could only salute to that person. If somebody has overcome a gigantic obstacle, well deserved. Here we are putting our systems to work and testing them as much as we can therefore our directions in trading are based on our great effort and long experience. So if someone has the method that works better, something like moving average crossovers mixed with the support and resistance lines, we wouldn’t have much to say than to be forever grateful if that somebody shares his knowledge with us. Do we think that our method is superior? Of course, everybody thinks that their method is better. We all see the values in our methods because we appreciate the benefits they give us. We should stay unpopular, we have wisely allocated our time, and we have a system that gets to take some emotions out of the game. These are some of the things that we endorse.

Traders, our advice on this would be to always keep improving on what you have. If somebody is an RSI trader and he is getting good results over time, he should never stop searching for better options out there. There is no reason to stop searching for improvement. If the results are not there it’s ok to jump from the ship, but traders, be honest with yourself, make sure that the results are there, and then try to upgrade your system. There is a whole brand-new world of tools out there, relevant tools, created for the forex market that we trade and they are certainly worth discovering and testing out. Successful or not we are not stuck, we could start to make money if we educate ourselves properly or we could make more money if we dare to embrace more education. We should try to discover the best tools around, we should closely observe our results and never stop improving our system. That might be the only way.

Forex Psychology

Chicken Run – Fear of Missing Out On a Trade

Every forex trader will at some point have to face a particular set of fears that will sometimes mean they fail to pull the trigger on a trade. A lot of people talk about missing a trade as some significant moment in their trading activity. They look at the price movements of a currency pair and think it might go a certain way, they might even have an idea of the price it might reach, and they watch it and watch it and lo and behold it goes the way they thought but they didn’t enter a trade. They look at situations like that and hypothesize that they could have entered a trade at such and such a time and then if they had closed it at just the right time, they would have made x amount of profit. But the thing you have to realize is that while we all might fantasize about phantom trades like that from time to time, they are a non-event.

They are truly unimportant in the grand scheme of things because, in reality, nothing happened. You could spend your whole time dreaming up phantom trades like that. You could watch stocks and see potential trades you could have made, you could watch exotic currency pairs you’ve never traded before and see “opportunities” where you could potentially have made thousands, tens of thousands or hundreds of thousands of dollars on a single trade. It didn’t happen. It’s nothing for you to think about, much less worry about. You will miss trades like that literally while you’re sleeping. We all do. Let them go.

Mind Games

One particular reason you should let them go – apart from that way of thinking being completely useless to you – is that there are many more important psychological phenomena for you to worry about. When you ask them about forex trading, most people – and even plenty of traders – would probably tell you it’s all about understanding charts, learning tools and indicators from books, and understanding the theory. Indeed, it is all of those things. But it isn’t one of those processes where you can put in A and get out B every time.

We are, whether we like it or not, squishy ape-like animals that have evolved to be good at a lot of activities but being cold, unemotional machines is, unfortunately, not one of those things. As with anything else in life, our psychology is a big factor in how we perform. As a result, understanding your own psychological or emotional responses to different situations is a key step in being able to control them or curtail them when you need to and to stop them from inhibiting your efficacy. In fact, it often tends to be the traders who think of themselves as unemotional and unaffected by psychological ups and downs who turn out to be the ones who struggle most in certain situations.

Trading has a myriad of ways of drawing you into an emotional response – sometimes when you least expect it – so understanding those potential pitfalls and being aware of your emotional state enables you not only to learn about yourself but also to avoid making the same mistakes again and again. For example, you might be able to explain to a small child that it shouldn’t do something stupid, like touch the flame of a candle, but its only when it realizes it for itself that it will internalize that lesson.

Pulling the Trigger

The moment in a trader’s day that is most fraught with psychological turmoil is when they have to pull the trigger on a trade they’ve planned and for which they have a trade signal from the system they have built up. Not, as in the earlier example, when they think about a potential trade but make no moves towards it. For want of a better way of putting it, the really scary moment is when you have run the numbers, analyzed the price activity, found an entry point, established your target, zeroed in on your timeframe, and set up your stop/losses. Once you’ve run through your whole checklist and even gone as far as opening an order on your trading system, you’ve reached the moment of truth. Do you click the button?

Now, anyone who’s been trading for any significant amount of time will have, on occasion, been wracked by doubt and backed out at this point. Not to put too fine a point on it, they will have chickened out and missed their shot. The sheer tragedy of doing that can unfold very quickly if the price moves the way you expected it to and you watch what could have been a successful trade slip away. Quite apart from really bumming you out, a missed shot like that can have several other knock-on effects. It can slide itself into your subconscious mind and affect the way you think about future trades. Without knowing it, you might still be having lingering thoughts about that moment not just when you make your next trade, or your next couple of trades – it can persist well into your next month of trading, or even longer. The fear of missing an opportunity like that is no small thing and it really can cause issues for your future trading, which is why it is important to have some self-awareness about it and to try to understand what happened.

Being Your Own Shrink

So what are some of the psychological causes of chickening out? A side note here, if chickening out is a bit of a strong phrase and makes it a little harder for you to think clearly about the issue at hand, try thinking about it as failing to pull the trigger instead. One of the big causes, for most traders, is a fear of failure. You look at the trade you’re about to make and you just feel unsure about it. Of course, all your indicators might be screaming at you to trade right now but sometimes – and we all feel like this from time to time so it’s nothing to get too concerned about – sometimes it just doesn’t feel right for whatever reason. There are ways to overcome it and they are pretty fundamental to how you understand forex trading, so don’t worry, we’ll get to them.

In the meantime, another possible reason people don’t enter a trade, when they otherwise think they should, is over-analysis. This is a bit counter-intuitive since analyzing the technical parameters that lead to a trade is pretty much the bread and butter of most traders. That said, there is such a thing as overthinking it. Some of us love nothing more than to get deep into understanding what causes a given currency pair to move the way it does and, for the most part, that makes us stronger traders. But there’s a flip side to doing too much research because the deeper you get and the more information you try to include, the greater the likelihood that some of that information is going to start contradicting itself. Sometimes you’ll have filled your head with so much reading about news events and looked at so many indicators that some of that begins to cause you to doubt yourself. And not only will you begin to doubt yourself, but you will also – just through the sheer act of spending so much time thinking and analyzing one trade – become too invested in it emotionally.

Yet another form of this is becoming unsure about your analysis in the first place. On one hand, this can lead you to try to overanalyze but also it can simply introduce doubt and put pressure on yourself. Of course, this is one of the most natural responses of any trader. In fact, it’s the traders who tell you they’re 100% sure about the outcome of a trade that you should worry about. Put simply, until you get that crystal ball working, you will never know the outcome of any trade. That inability to see the future reduces every trade to a binary outcome. It will either go your way or it won’t. Little wonder then that this is a cause of stress. But this over-focus on the individual trade is what’s holding you back and therein lies the crux of the problem.

Fighting Back

The single most important thing to understand when trying to overcome all of these hurdles is how you approach individual trades and forex trading as a craft.
If you are focusing on and sweating over each individual trade, you’re doing it wrong. The only way to trade forex and be successful at it, rather than burn out quickly or fade over time, is to establish a system and a process. When you understand trades as part of a process, rather than as individual events on who’s success everything depends, you will free yourself of many of these fears. Once you begin to see trading as something that takes place over the long term, you will become a better trader. And once you have a system in place that means you are going to be right more often than you’re wrong, that you make more money than you lose, you will cease to rely on individual trades for your sense of wellbeing.

Approach each trade afresh. Free it of any losses that came before and understand it as one of the dozens, if not hundreds, of trades you are going to make over the coming year. Judge your success not on the outcome of individual trades but on sets of trades over a longer timeframe. Of course, there are some simple, practical solutions to certain issues too. If you are suffering from a crippling fear of failure over individual trades, you are likely committing too much to each trade. It might be time to reconsider your position size and work on your money management. If you are so unsure of your analysis you regularly find yourself failing to pull the trigger on trades your system is flagging up, you might need to go back to the drawing board.

Indeed, better than that, take your system for a spin on the testing circuit. Put the work in and power up a trading simulator or your demo account and test your system, your process, your checklists, and your whole approach. The great news is that thanks to technology, you can now do this more easily than ever. Assess how your system performs over a significant period – say a hundred trades. This will not only give you a greater sense of security but will also help you to see trades not as one-off events but as part of a process. A larger set of trades will really show you whether your system is working in a way that a single trade never can. Having substantiated confidence in the system you are working with is an enormously important aspect of trading that can help you overcome the smaller, short-term psychological hiccups.

Finally, once you have fully internalized the fact that trading is a process and have gained confidence in your system, you will be ready to overcome even the most dreaded of events for any trader: a losing streak. Psychologically this can be tricky even for the most experienced of traders. But the plain fact of the matter is that the more you trade the greater the statistical chance that you will encounter, through no fault of your own, a run of bad trades. The most dangerous thing you can do is start to mess with a strategy you have taken a long time to establish on the back of three or four losses. It’s a trap many fall into. The good news is that if you have managed to free yourself from over-focusing on single trades and if you have confidence in your system, you are perfectly placed to be able to see every new trade as a fresh start.

Beginners Forex Education Forex Basics

Why It’s Sometimes Better Not to Trade

We are always on the lookout for that new trading opportunity and ways to give us more trades and therefore more profit. It’s great when we find one, all of the requirements set out by your trading strategy have fallen into place and it’s the perfect trade. The problem is that pinpoint perfect trades don’t come along all the time, in fact depending on your strategy it could take a week for each one to fall into place. So if things aren’t there, how do we put on enough trades to ensure we reach our targets? Well, they will come, what you do not want to do is force them, so sometimes it is actually better for you to miss that trade, sit it out and let the opportunity pass and you will be better for it, take the trades that are there, not the ones that you want to take.

So let’s take a look at some of the reasons why it may be better to not take those trades.

There are days when trading when you just do not feel up for it, we all have our off days we have days where we are that little bit extra tired, or maybe a little worse for wear after a heavy drinking session. Do you think that it would be appropriate to trade in these conditions? Probably not, you are far more likely to miss things or to read something incorrectly on the charts which could then lead to mistakes and bad trades being made. If you are not feeling like you are up for trading and are not at least 90% of your best, you should avoid it. Mistakes can and will be made when you are feeling tired, so it’s best to avoid trading entirely in this condition. You can, of course, look at the markets, but we would advise not putting that trade on, at least not on a live account.

Another reason to possibly avoid putting on trades is if you have had a number of different trades lose in a row, known as a losing streak. While these losses may not have anything to do with you doing something wrong, it is often a good idea to take a step back. While you may not have been doing anything wrong when it comes to your strategy, those losses can have a psychological effect on you which could potentially put you at risk of making some bad trading decisions. There is no harm in avoiding a trade or two to reevaluate your strategy, just in case something may be wrong or in case you are feeling the stress. Do not be afraid to take those breaks and skip those trades.

Another good reason to avoid putting on that trade is the simple fact that you are just not certain about the trade. If you are not 100% that a trade will work, then there is no harm in not trading it. In fact, this behaviour is probably advised over taking something you are not fully sure of. Even if you are sure, if there are different things in other technical or fundamental analysis that you have done which could suggest otherwise, this could be a reason not to take that trade. If they are indicating some uncertainties then this should actually be a warning sign that your trade may not be as safe as you may think it is.

If your risk to reward ratios are not right, or you have been placing trades with lot sizes that are too high, then this is a good time to stop your trading, do not put on any more trades, you need to get this sorted. Even if you have been profitable and the majority of your trades are right, it does not mean that it is right. You need to reevaluate your trading and the lot sizes that you are using.

Sometimes things just do not work for you, there are days where you just can’t seem to work out the markets, this is nothing bad on your side and the markets are not acting any stranger than usual, you are just simply out of synch with them. There Is no harm in using this as a time to learn instead, do not place trades when you are in this situation, they will only end up being bad trades as your concentration levels are just not there. If you feel like you don’t have the attention span for it, or you are struggling to remain focussed, do not try to force trades, you will surely miss something which will only lead to losses.

So those are a few of the things that could and should cause you to potentially miss out on some trades and to not place them. There is no harm in not placing trades, in fact, it can help you, not only will it prevent you from making any potentially bad trades, but will also give you more opportunities to learn and develop as a trader.

Forex Fundamental Analysis

Flash Crash Precautions for Technical Traders

After the recent publication of a book called Flash Crash, the concept of the same name once again stirred the attention of traders across different markets. This controversial literary record of Navinder Singh Sarao’s very public 2015 arrest after having previously amassed staggering $70 million buying and selling futures from his London home points to the existence of fragilities in markets. As opposed to regular pricing fluctuations, a flash crash entails an extremely volatile and sudden plunge of the pricing of a security traded on the open market before quickly recovering. With more and more instances of such swift declines, we can see the aftermath of these dramatic volatilities in the markets of stocks, futures, currencies, and cryptocurrencies as well. Whether it results from programming code errors, specifically designed algorithms, and fraudulent behavior, or some other drivers, flash crash plays an important role in assessing risk levels for traders worldwide.

The currency market underwent a major flash crash on January 3, 2019, which took place on the AUD/JPY pair. Since these two currencies are some of the world’s most important exchange rates, their 2019 dynamic was so unbelievable that it drew the attention of the media and traders across the world. With AUD becoming very weak and JPY gaining strength, the currency pair fell the unbelievable 7% in a matter of three minutes. Considering the fact that that the prices plummeting to this extent is exceptionally rare even in a week’s time, one could naturally assume that some major crisis, such as bombing or death of a president, was responsible for such violent move in the currency market. As a flash crash is rather believed to be a deliberate act of market attack to obtain profit instantaneously, the previous assumption falls short.

Some sources discussed how extensive the damage of these volatile activities in an illiquid market had on the Australian economy. With China being on holiday during the week of the event and the U.S. market closing, a drop in liquidity occurred. One of the biggest American companies, Apple, expressed concern regarding the impact which the slowdown in China could have on its fourth-quarter revenues, immediately shifting investors’ focus on the havoc these circumstances could wreak on the global economy. Along with several currency levels being extremely low against the yen at the time came burning questions concerning market liquidity, algorithms, and overall market functioning, which reasonably caused deep concern among traders around the globe and not only in the currency market but other markets as well.

Despite the media frenzy over the global economy, some sources pointed out that liquidity had little effect on anything but the currency market. In fact, the images below portray some major discrepancies between the evidently severe states of the AUD/JPY pair and the stock market performance during the 2019 flash crash. The proportion of these differences then aroused curiosity about the reasons why the prices rebounded immediately after the decline. Some financial reports on this event reflect on the stability AUD/JPY enjoyed over the course of 2018, which may point to the possibility of some major banks and/or institutions getting involved. Interestingly enough, right about the time of the 2019 flash crash, 89% of AUD/JPY traders were going long. As this was a virtually unforeseen ratio of 9:1, it was almost a perfect opportunity for big banks to step in do what they always do – redirect the prices and cream off the profit. Even if the Japanese government decided to move JPY up or down, this process would happen gradually, as opposed to what the currency market witnessed in 2019.

As the AUD/JPY pair closed down approximately 83 pips on the day of the event only to bounce right back up to the levels at the end of 2018, we need to draw some deeper lessons. We can attribute the magnitude of this catastrophe to the media and the big banks, but essentially if you do not analyze risk, timing, and strategy, among others, you are inevitably putting yourself in much greater risk. Most traders whose accounts were completely destroyed as a result of the 2019 AUD/JPY volatility, drowned themselves with emotion-based trading, greedily going after a bounce. Although the 2019 currency market flash crash was not the first occurrence of this phenomenon, the individuals practicing the indicator-heavy approach to trading, especially the ones beginning to build their accounts, experienced a shock as well. Those traders who managed to get out understood how relevant technical analyses and understanding indicators are for surviving the market’s instability.

Brexit and the 2015 EUR/CHF crash both exemplify how such events can influence the creation of a really large candle closing at an entirely different point from where it started. The 2019 flash crash too revealed some unusual facts, where the open and close on the AUD/JPY currency pair were only 83 pips apart, yet with a noticeable high and low. While most indicators typically focus solely on the open and close, ignoring additional information regarding the highs and lows, ATR would be the only tool that could give out relevant signals. At such times, ATR would read much higher than usual, and as flash crashes rarely happen, you would know that the information you were getting was telling you to take a certain action. In case you are using a volume indicator, some of the more average versions might be able to catch the highs and the lows, in contrast to the better versions whose quality stems from its ability to filter out any such activity.

Whether you are using the ATR alone or together with the volume indicator, you should consider the settings which tell how the indicators are measuring data. For example, with the ATR, the settings typically indicate the number 14, which stands for 14 candles, which for daily traders implies that the data is recorded 14 trading days back. Due to the impact of events such as the flash crash, you will not be able to get an accurate reading for another two weeks. Nonetheless, despite the equation being susceptible to these sudden changes, you can still proceed with the trading on the affected currency pair if you take the reading from the day before the event took place. Therefore, in the following 14 days, you will not be including the indicator’s reading, but relying on the one fixed number you found on that particular day.

Even though events such as Brexit and the 2015 EUR/CHF crash are not very common, they still occur every few years, which is why every trader should know how to prepare for the unexpected. As we explained above, the out-of-the-ordinary candle created at those times will inevitably affect your indicators, regardless of how well-devised an algorithm you use. Whichever currency pair undergoes these massive influences, your only task is to stay put and refrain from taking any action. If any currency was under impact because of some external factors, such as GBP after Brexit in 2016, you would not be trading that currency until all indicators went back to normal. What this further implies is that you may need to check the settings to see how far back your indicator is going to record data and patiently sit out for that period of time. Moreover, any attempt to adjust and set up your indicators will prove to be until those big candles are filtered out of the system. Luckily enough, there are approximately seven other major currencies you can trade and keep your account active.

Apart from the 2019’s flash crash, we can trace several other such events happening in the past few years: ETH in 2017, GBP in 2016, and Singapore Exchange in 2013. Although they do not occur very often, once they do, though, no market is exempt from such an unexpected price plunge and rebound. What is so volatile about flash crashes is that, despite what sets them off, they deeply and profoundly affect the market. We may not have enough insight into the intentions of the major players, but we must take into consideration the amount of impact they can have on the direction of prices and the overall market conditions. Nevertheless, regardless of the current climate, every trader now knows the two strategies they can use at such times. If you are a trader of currencies, you will either rely on the data recorded one day before such an event to proceed with a trade on the affected currency or decide to sit out until further notice. Whatever you do decide, however, do not let yourself run after some transient highs searching for some instant gratification.

Forex Psychology

Three Ways to Boost Your Trading Confidence

Trading is a difficult thing to do, well it’s difficult to do well and to do it well consistently. There are a lot of things that can happen that can really put a dent on your confidence levels, losses are a part of trading, yet every single loss is going to hit your confidence levels and can make you question whether or not you are doing things right or whether or not it is the right career or hobby for you.

With so many things to hit your confidence levels, it is important that you work out ways to increase it again or to keep it high. If you are making profits, no matter how many losses you have you should be feeling confident as this is something that a lot of traders fail to do. So let’s look at a few of the different things that you could be doing that could potentially help you to increase and keep your confidence levels high.

#1 – Practice

One of the more obvious things, the more you do something, the better you will get at it and the more confident you will be at doing it. The reason people get good at things is simply through practice, you will never be able to plan for every scenario, so having p[racticed through them will give you that little bit of confidence and understanding of how you can deal with the situation at hand without having to worry too much.

#2 – Look at the Bright Side

When things go wrong, there are two things that you can do, you can take it personally or you can look at the brighter side and use that loss as a new learning opportunity. There is always a positive to every negative, it is important that you take a little look for it, this will give you a better perspective of what has gone wrong and will enable you to continue to trade without taking that loss personally or thinking that you may not quite be good enough because you are, everyone experiences these losses, everyone even the millionaires, so do not take it to heart and carry on with your confidence high and a new learning opportunity in hand.

#3 – Focus on Your Trading

Try to focus on what it is that you are doing, do not worry about the things that others are doing or what the results of others are, concentrate on you and only you. If you are not comparing yourself to others you will only have your own past experiences and results to go by, as time goes on you will notice an improvement in your results which will help build your confidence through seeing the progress that you are making. As soon as you compare yourself to others, you will find people doing a lot better and this will hit your confidence levels, so stick to comparing yourself to you and not others.

So those are some of the things that you can do to try and help keep your confidence levels high, it is vital to keep it high and to build up, this will keep you motivated and happy when trading, it will also help to keep away some of those more pesky emotions such as stress.

Beginners Forex Education Forex Basics

How to Avoid Missing Out on Great Trades

If you have been trading for any period of time, you would have come across the scenarios where you have looked at the markets, analyzed them and found a good trade, but you never took it, an hour later you are back looking at the markets and noticed that if you had taken that trade, it would have hit its take profit and more, so why didn’t you take it? You have no idea because you didn’t write it down. We have been told 1,000 times to write down everything about your trades, why you entered, whey it won or lost, but we are very rarely told to write down why we don’t make a trade, and this is often a great indicator as to why we are missing trades. It’s like the long-standing saying of “If it isn’t written down, it didn’t happen.”

It is important to understand that while you do not need to take every trade opportunity that is available, and some of them you may not be able to take for one or many reasons, but consistently missing good trade opportunities will only hurt you in the long run, both your account and your own psychology as a trader. It can lead to discrepancies between your actual trading and the backtesting that you have performed where most of the trades have been taken. There is also the law of averages if your strategy generally wins 60% of the time (and that is generally what is needed) and you miss out of 5 out of the next 20 trades, those 5 trades would have been winners, you are now getting towards a losing average which doesn’t mean your strategy is bad, it just means that something happened to cause you to miss trades.

So let’s take a little look at some of the reasons which could cause you to miss trades.

You lost your last trade

Losing a trade is never easy, it stays in your head and if you lose a few in a row it can be hugely demoralizing and may even make you want to give up. Don’t, you have a strategy, a strategy that works, so why stop? Every strategy has its winners and losers, in fact, every industry in the world has its ups and downs, if Universal Studios gave up after its first loss on a film, we would have some of the great films that came afterward. It is important to accept the loss as a loss, its part of the strategy, try to remove it from your mind and move on to the next one which as you just watched, was profitable, but you didn’t take it.

Use a journal

You should already be making a journal entry for the trades you make, but now you need to start making a journal for the ones you do not take. Why didn’t you take it? What hade you avoid it? What were you thinking? Was it still in line with your strategy? Asking questions like this will enable you to understand exactly why you didn’t take it, it is also a way to look back and reflect. It can help to identify some of the major reasons why you are missing trades and help you to overcome those obstacles in the future through planning.

Not enough margin

There isn’t much we can say on this one based on your psychology, this is down to your risk management or strategy as a whole, if your strategy is asking you to make more trades than your margin can take, then you may need to change it up, either by scaling down the lot sizes or changing criteria to produce fewer trade signals. Not having the capital to make a trade can cause negative thoughts in your mind, thinking that you need to make some larger trades or trades outside of your strategy so you can build up your capital to be able to afford the new trades, do not do this, instead adapt your own strategy to suit your current account balance.

No confidence

A loss can cause your confidence to take a knock, that is natural and it happens for anyone who has emotions. However, if you are suddenly feeling low and are not taking trades because you are no longer sure of your strategy. Do not skip the trades, simply lower your trade sizes, this will allow you to risk less per trade, reducing the risk can give you back a bit of your confidence that you won’t lose as much on a losing trade.

Not setting alerts and orders

Most trading platforms now come with some very handy features, they can allow you to set up alerts that get sent to your email, phone, or simply give off a message and alert tone. We know that you can’t always be right next to the computer 24/7, so the alerts allow you to get on with your life and as soon as a trade setup comes up, you will be alerted and can then make the trade. Not having these set up will cause you to miss those trade opportunities that come up while you are cooking the dinner or out at the shops.

Looking at individual trades instead of Forex as a whole

This is relevant to anything in life, if you look and concentrate on a single aspect of trading, then you will either be extremely happy or extremely down. You need to look at the big picture, look at your account, strategy and yourself as a whole, there will be losses that are part of trading, there will be winning, another part of trading. The ups and downs are what makes Forex exciting. Your strategy has been built to be profitable in the long run, so look at it like that, don’t get discouraged by a single loss or two.

Don’t shrug off a missed trade as something that you could have taken but didn’t, use it as a way to learn why you didn’t take it, this will help to benefit you in the future and will help to make your strategy far more profitable than it currently is.

Forex Psychology

How to Cope With Trading Boredom

Trading can be an incredibly exciting thing, especially when you are first starting out and everything is brand new to you. Even for experienced traders, it can be an incredibly exciting and thrilling thing to take part in, especially when there is a lot of volatility within the markets. The problem comes when the markets are a little bit slower, in these slower conditions something called trading boredom can set in.

Trading boredom can simply be described as the period when there is nothing going on, the markets aren’t really moving and even if they are, they are not moving in a way that is suitable for your trading strategy, and so you are sat there with nothing to actually trade, not much to analyse and nothing to do at all, this is where trading boredom begins to set in.

While boredom can bring our motivation levels down, it can also lead to other problems. It can make us far more likely to be distracted, those little toys that you have in the room, or the TV in the corner will be turned on a lot more often than it will. This creates a really bad habit when it comes to trading. You want to be getting rid of these distractions, so this trading boredom leads us towards a very slippery slope because if you get into the habit of getting distracted, it will be hard to break out of it.

So we briefly mentioned that boredom can actually reduce our motivation levels which in itself is not a good thing. Without motivation, we become more easily distracted and can make us just not want to do it. In fact, a lack of motivation is one of the things that can cause people to quit trading completely, which is of course not a great thing because trading is such a fantastic opportunity and a great hobby to have.

The problem with boredom is that for some it is unbearable and so they decide to try and force some trades, this is never a good idea, neve. All that this will lead to is bad trades and the inevitable losses that come along with them, if you are feeling bored, the last thing that you want to do is force trades, so do not do it, none, not even one, it will lead you down a slippery slope which for many there is no way to return from.

For some it is easy to get through these dull moments in trading, they do not need any added stimulus and can very patiently wait out the slow moments., For many though, it is not quite this easy and these dull moments can be a real killer. We need to find ways to help reduce the feeling of boredom and so we have come up with some ideas that you could try which could help to alleviate that feeling, some may work, some may not, but it is always worth trying as you do not want to be stuck with the feeling of boredom, it will only make you want to put down your trading tools and leave.

When the markets are slow, it is the perfect opportunity to learn a little more, learn something that you do not know much about. This could be a new strategy or just something smaller than can be used to adapt your own strategy. It is also a perfect time to start learning about additional timeframes. These can be used to help you confirm your analysis, as the more timeframes that you understand, the more accurate your analysis can be.

It can also be the perfect time to teach yourself a new skill, patience. Patience is key when trading, these dull moments will always be there, some lasting minutes, others for potentially days. Having an understanding that you have your strategy set, you understand the entry requirements and now are just waiting, do not see this as a time to be bored, think of it as waiting to pounce on the perfect trade. Building up your patience will benefit you in the long run and will potentially help you trade in more strenuous market conditions down the line.

If we are used to the high pace markets, then these slower moments can be even worse, you need to be able to slow yourself down, to calm yourself from all the excitement that you are used to. Take a few minutes before sitting down to trade to relax, take some deep breaths and slow your body and mind, this will allow you to better focus on the issue at hand and to be more in sync with the markets.

There are also a lot of trading forums and communities out there, do not be afraid to join a few. Some people often think that they are a waste of time or that they will not be able to learn anything from it or that they are simply full of people wanting info but not willing to give them. This is certainly not the case, there is a wealth of information out there, you will always find answers to questions and a lot of information that could be beneficial for you, not only this, but it will give you something to do while the markets are quiet, taking away some of that boredom.

So remember, there will be some dull moments, no matter what your strategy is or how long you have been trading, there is always the opportunity for the markets to be slow and for you to struggle to find trades, it is important that you know what to do with yourself in those situations. If you have a lot of patience then it won’t be an issue, but for those that find it hard, keep looking for something for you to do, different forums, new analysis, new strategies, anything that isn’t forcing trades. So have some things planned to do for those quiet moments, that way you won’t be tempted to make those bad boredom trades.

Beginners Forex Education Forex Basics

Six Questions To Ask Yourself Before Trading Full-Time

The aim of many new traders, as well as those that have been trading for a while, is often the desire to go full-time, to be able to trade instead of working a 9-5 job, getting rid of your boss would be a dream come true. It is certainly something that is possible with trading, but there is a lot that needs to happen before you can even consider going full time, a number of questions that you need to answer before you know whether going full time is right for you. It also comes with many risks and things that you need to consider.

So let’s look at a few of the questions that you will need to ask yourself, of course, which ones you want to take notice of are up to you, and each individual will put a different weighting onto different questions, but consider them all to see whether they are actually ready to go full-time.

Are you consistently profitable?

Let’s be honest, the prospect of getting rid of your job is a strong pull to going full time, but are you currently making enough to sustain your lifestyle without a job? We have seen people jumping into full-time trading when they are just about breaking even or making a few hundred dollars each month. That is not exactly the same income that you were making with your job. So you need to consider whether what you are bringing in is enough to keep you going, if it is not, then I would strongly suggest that you wait before going full-time until you make enough to cover your entire living costs and have a little extra for yourself afterward. Quitting your job to trade and not making enough will only land you in some serious financial issues with the potential of actually losing where you live from not making enough for rent or mortgage payments.

Do you have any savings?

This kind of works along with the previous point, do you have some savings that you can use in case things do not go the right way every single month. It is vital that you have a little on the side in a savings account that you can use to help subsidize the months that you did not make enough, we would suggest that you have around 6 months worth of bill and food money available in a saving account before even considering that you are going to go full time. The last thing that you want is to go full-time and to then realize that you aren’t quite making enough and you are short of your rent this month, not having those savings available will mean you will be forced to go into debt and potentially look for another job, so ensure that you have that backup available, it will help reduce a lot of the stress that comes with trying to financially support yourself through trading.

Do you have enough trading capital?

Once again we are looking at money, so let’s imagine that you have some decent savings available, three to six months worth of your rent, but do you also have enough to trade with? There is absolutely no point going full-time if you have a trading account balance of $1,000, you are not going to be able to make enough to sustain your lifestyle. You need to ensure that you have enough money available in your trading account to allow you to make enough profit to live off. The more you have the more consistent and better risk management you are able to use. It would be far more sensible to have a trading account of $100,000 rather than $1,000, so make sure you have enough to realistically make the amount that you will need to live off.

Are you mentally prepared for trading full-time?

Trading full time can be stressful, it can be very stressful. When you trade at the moment, the only thing that you are risking is the balance in your trading account, but when you go full-time, you are risking not only that balance of that account but also where you live, in terms of the rent and being able to pay it. This adds a whole new level of stress to your trading, it can cause frustrations and it can be a very stressful and difficult situation. How do you deal with stress? How do you deal with loss? Do you easily become frustrated? If you struggle with any of these then there will certainly be times when trading full-time really puts you under pressure, and if you are not able to deal with it or work out ways to reduce them then you will surely struggle long term. So ensure that before you go full-time that you are able to deal with these emotions and feelings.

Do you have support around you?

Trading on the best days can cause a lot of stress on you, and trading is also quite a lonely experience which is not a great combination as it can lead to a number of different mental and physical illnesses. Due to trading being such a secluded activity, it is important that you have people around you that you are able to talk to, this can be people on line, family or friends, as long as there are people there that you can talk to and to vent some of your frustrations and ultimately to get a little help, especially when feeling stressed or frustrated. Simply talking to someone allows you to get that out and can often act as a distraction and a way to clear your mind, you will certainly need those times and those people to help you through your trading career.

Do you understand the risks?

There are a lot of risks when it comes to trading full-time, we have spoken about some of them above but are using this opportunity to really push the idea of how risky trading as a living actually is. There are so much pressure and risk in it, your entire livelihood is being put on the line If you do not have enough savings to sustain you through the months that are not profitable (and there will be some) then you will seriously struggle with paying for basics such as rent which could ultimately cause you to lose your home. You will also lose a lot of your social interaction, trading is a lonely job, so doing it for hours each day can isolate you from others, causing all sorts of potential mental health issues. You will be under stress and you will have financial issues if you have not planned for it properly.

So those are some of the things that you will need to think about. Going full-time is a huge thing, it is something that a lot of people aim for and dream of. However, it has such high requirements and the risks that come with it are huge, it can ultimately make or break your trading career and if things go wrong, even your current lifestyle. If you are thinking of going full time, then make sure you are ready for it and make sure that you have a backup plan ready, it is vital for your survival and to make the transition as smooth as possible, if you do decide to go full-time, then we wish you the best of luck.

Beginners Forex Education Forex Basics

Should You Be Trading Forex?

Should you trade? That is a big question, it is something that you need to ask yourself, in fact, it is something that everyone who is thinking of treading will need to ask themselves, this is for the simple reason that trading really is not for everyone, in fact, it is for the few due to the number of requirements that it requires and the stresses that it can put on you. So let’s take a look at what sort of things are required, so you can work out whether it is the right thing for you.

Do you have disposable income?

One of the main rules of trading is to never trade with money that you cannot afford to lose, so you need to be able to say yes when asking yourself whether you have disposable income. This is money that will not affect your life in a negative way should you lose it. As soon as you get into the territory where you will be missing out on things or even worse not being able to pay bills if you were to lose the money, then you need to take a step back and wait. Do NOT trade on money that you need, if you lose it, it can lead to a very dark spiral, so be sure that any money that you are willing to trade with, you can consider lost as soon as you deposit it into your broker account.

Do you have a lot of free time?

Time, something that a lot of us complain about not having enough, the unfortunate thing about trading, is that you need quite a lot of it. You need it for both learning and for actual trading. While you can make do with an hour two each day, and a lot of traders actually do. This will dramatically slow down the process of learning and developing your own plans. Trading takes a lot of time, the initial learning can be so intense that it can take a couple of hours to learn even the basics, so if you are struggling for a time through work and family life, you may struggle to pick it up. This is not to say that you cannot, just expect it to be a long process.

Can you deal with stress?

Stress, a major factor with trading and for a number of different reasons. A lot of people find it hard to deal with stress, when they are put under a lot of it they can either freeze up or the quality of their work takes a hard hit. With trading, you need to be able to deal with it, as soon as stress begins to take over, it will inevitably lead to mistakes and ultimately a loss of money. There are certain techniques that you can use to help reduce it such as taking breaks, but ultimately if you are not good at naturally dealing with it, you could find trading to have quite a negative effect on your stress levels and overall well being.

Do you like math?

The majority of people when you ask them whether they like math or not will simply state no, most people hate it. Trading has a lot of similarities with math and uses it in pretty much every aspect, working out take profit levels, how much to risk, currency changes, resistance levels, all of it requires an aspect of math, yes there are calculators for a lot of these things, but you will need to be able to get a grip on the underlying equations and statistics if you want to become successful. So if you dislike maths, there is a chase you could dislike trading too.

Do you get lonely easily?

Trading is not really a social thing, of course, there are ways that it can be, but for the majority of people it is quite a lonely experience, you will spend a lot of time by yourself looking at a computer screen, reading, learning, practicing. The only way to get a better understanding of that experience is to do it, so there can be extended times of being by yourself You can break these up by taking breaks, going out and those sorts of things, but that doesn’t change the fact that there will be a lot of lonely nights by yourself, just you and your computer screen.

Are you a rule breaker?

A lot of trading is about making rules, when you first start you will be told that you need to create a trading plan, this plan will contain a lot of rules that you will need to follow, in fact breaking any one of them will result in what is known as bad trades. If you are something that does not have the discipline to stick to the rules, then you will end up making a lot of mistakes and bad trades.

Can you control your emotions?

Are you able to control all of your emotions, we are thinking about emotions like greed or overconfidence, one is a very negative emotion of wanting more while the other is a good emotion of believing in yourself, but both can have the same devastating impact on your trading. Trading is an emotionless thing, it doesn’t care about how you feel or what you want, it cares about the money. If you let emotions get the better of you it can cause forced trades for more risk, which ultimately will lead to losses.

Do you like risk?

Trading is risky, there is no other way to mention it, there is a reason why any service that offers trading opportunities needs to note on their site that there are a lot of risks to it. There is a good chance that you could lose everything you put in, and there is a certainty that you will lose some of your trades, the majority of them when starting out will be losses. If you are afraid of this, then trading is not for you. If you are not happy with a minimum of 1 out of 3 trades being a loss, then trading is not for you.

Do you understand that it is not a get rich quick scheme?

With its rise in popularity, also comes the rise in its advertising. The majority of adverts you see these days are from brokers offering low entry limits and great leverage, or from affiliates stating how easy it is to make money, not to mention the thousands of scammers and lies out there. You need to understand that trading is not a get rich quick scheme. In fact, those that are profitable now, probably took over a year to break even. There will be losses, there will be wins, but one thing for sure, you won’t wake up rich the next day, it will take a long time to get there.

There are of course many other things that you will need to ask yourself, but these are some of the major ones., Trading is certainly not for everyone, the majority of people who start trading will quit after a month or two, either from losing the money in their account or by finding everything a little too much. It can be overwhelming, but if you found that you are able to cope with a lot of things mentioned above, then it may be something worth trying. Start with a demo account, work your way up, it is a slow and long process, but ultimately a fantastic opportunity to make changes in your life.

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.

Beginners Forex Education Forex Trading Platforms

Overview of the ThinkorSwim Trading Platform

The ThinkorSwim trading platform was launched by TD Ameritrade to provide traders with essential trading tools through their browser, desktop, or mobile devices. If you choose TD Ameritrade as your broker, you can choose between the ThinkorSwim platform along with the broker’s own mobile platform (named TD Ameritrade mobile), NextGen web platform, and Classic web platform. Overall, ThinkorSwim seems to offer the best market access and features out of these options. Take a look at ThinkorSwim’s features, market access options, and some of the conditions for the supporting broker below.


  • Trade forex, equities, options, ETFs, futures, and more
  • Free “papermoney” account that works like a demo account with $100,000 worth of virtual funds
  • 30-minute platform walkthrough with a pro
  • 24/5 trading
  • Economic Data tool
  • Built-in search engine that allows one to find key economic indicators
  • Custom Alerts with preselected list of popular events and option to choose your own alert parameters
  • In-App chat with trading specialist and ability to live share your screen for convenience
  • Chat Rooms where traders can share ideas, strategies, and other knowledge
  • Charting feature that displays social data in graphical form
  • Access to 400+ technical studies
  • Add visuals to your charts, including selection of 8 Fibonacci tools and 20 drawings
  • Build your own algorithms with thinkScript
  • Ability to identify entry and exit strategies thanks to SizzleIndex
  • Live streaming media for fast news updates
  • Filter stocks

Access to Markets

The ThinkorSwim platform offers access to certain markets, depending on whether one is using the browser-based version that doesn’t require installation, the mobile version, or the desktop download.

Desktop Download: forex, stock/ETFs, futures, options

Browser Version: forex, stock/ETFs, futures, bonds & CDs, mutual funds, options

Mobile version: forex, stock/ETFs, futures, options

TD Ameritrade

If you want to use the ThinkorSwim platform, you’ll need to open an account through their broker, TD Ameritrade. You may have heard this name before, as this broker is well-known and generally liked by their clients and review sites. You’ll definitely want to check out their website and read everything yourself before opening an account, however, we’ve provided a simple overview of what conditions with this broker are like below.

  • Standard, Retirement, Education, Specialty, Managed Portfolio, and Margin Trading accounts
  • Commission-free trades online or $0.65 per contract on options
  • Transparent fees
  • No minimum funding requirement to open an account; margin or options privileges require a $2,000 deposit
  • Interest is applied on eligible account balances


ThinkorSwim is one of a few trading platforms offered by the well-known broker TD Ameritrade. If you want to use the platform, you can sign up for an account through the broker with no minimum deposit requirements. There are also some added benefits to using this broker, like applied interest on accounts and free commissions. The ThinkorSwim platform also offers several perks, including access to a wide variety of financial markets, special tools, a built-in search engine, and many other features. Unlike many of their competitors, all of these features and tools are unlocked for free as long as one opens an account through TD Ameritrade. Many others charge monthly fees or place harsh limitations on free versions of their accounts. Overall, the ThinkorSwim platform is a solid option that deserves more recognition in the world of forex trading.

Beginners Forex Education Forex Basics

Trading Frequency: Which Is Better – More or Less?

Some traders spend their entire day watching the market without a break. Others only make a few trades every week and don’t spend nearly as much time watching their computer screen. You may already have an idea of whether it is better to trade more often or less often, or you might be here because you’ve heard traders talk about both.

It is often said that trading less is better. Many traders might wonder how that can be true, considering that it would seem like more trading equals more money. One common argument that supports the less is more theory is as follows:

If you enter fewer positions each week or month, you’ll naturally put more thought into the trades that you take, thus increasing your win rate.

This would also decrease the chances that you could lose, although you would hope to win most of the trades that you do take. Another advantage to trading less often is that it is less time consuming and doesn’t require you to be constantly glued to your computer screen, although you do need to keep an eye on the market so that you know when to close your trades.

You also want to consider your trading strategy if you’re thinking of trading less often. While day traders typically open multiple positions per day, you might only want to open one or two trades a day or around 5 trades per week. Position trading and swing trading fit best with trading less often because traders open positions and leave them for days, weeks, months, or years in extreme cases, making these styles ideal for those that want to limit their trades.

On the other hand, some traders will argue that trading more often is better. Scalpers and day traders definitely come to mind here, as both trading styles involve opening multiple positions per day. On some days, a scalper might even open hundreds of positions in an attempt to profit from small price movements in the market. It could also be said that trading more could help reduce your losses, as you would have more chances to enter winning trades. Even if the market moved against you on some trades, there would likely be enough winning trades to keep you from going into negative territory.

The bottom line is that trading more or less often comes down to your trading style and personal preference. We won’t argue with the fact that trading less often makes it more likely for traders to put more detailed thought into their actions when it would be difficult to be as precise if you’re opening hundreds of positions per day. Yet a scalper or day trader would argue that there’s no way for them to make a profit without entering multiple positions per day. This is why it’s important to consider all of the pros and cons when it comes to this topic. In the end, only you can decide whether trading more or less often suits you better.

Beginners Forex Education Forex Basics

What Do I Need to Trade Forex?

We know why you’re here – you’ve heard about forex trading, and you’re looking to get involved. Forex trading can be a great source of future income and it can even replace your real job in some cases. With so many articles and tips out there, you might be wondering what you need to get started. It can’t be as easy as opening a trading account and becoming a millionaire, right? If it were, then most people would be doing it. The good news is that most of the things you need can be acquired easily if they aren’t already in your possession. Below, we will detail the 4 things you absolutely need to become a forex trader.

An Education

The first thing you need is to be educated, everything else comes later. There is no reason to open a trading account if you aren’t prepared to start trading because some brokers will charge you inactivity fees for letting your investment sit there untouched. You need to start with basics, like terminology. Then you’ll have to understand the mechanics of trading, as in how to do things like place orders, set your stop loss, and so on. Reading about trading strategies, risk-management options, trading psychology, how the news affects trades, etc. are equally as important. This is something anyone can do for free, so long as you have a working internet connection.

There are even different mediums out there for learning, like articles, eBooks, videos, webinars, seminars, trading courses, and so on. If something just isn’t making much sense to you at first, don’t give up. Try researching that subject through a different medium, for example, if reading the material doesn’t make sense, try watching a video. Otherwise, you could try looking on a different website to see if another author can offer a clearer explanation. Anyone can get a trading education if they put their mind to it, but you’ll need to understand that this will take hard work and dedication. You can’t learn everything you’ll need to know in an hour, an evening or even a day. It can take weeks and months to take in everything you’ll need to know. As a forex trader, you should always pursue a better education and continue to improve your understanding.

An Investment

Another must-have item every trader needs is an initial investment. The good news is that many brokerages will allow you to get started with as little as $5, or maybe around $100 or so. This shouldn’t be too difficult to come up with, so this still leaves the door open for everyone. However, you should note that you’ll probably be stuck with a Mini/Micro/Cent account or a regular Standard/Classic account if you’re making a smaller deposit. Most brokers market these accounts towards beginners and save better conditions for Premium, Platinum, Gold, VIP, or other similarly named accounts. Better accounts can ask for deposits in the thousands or even hundreds of thousands, which puts them out of reach for most traders. Fortunately, you can get started with as little as $5, just have realistic expectations. Don’t expect to make as much profit as someone that has invested $20,000 or more. You also need to be investing your disposable income, never try to invest the money you need to live off of. There’s nothing wrong with saving up over time if you’d prefer to enter the market with a larger investment.

A Device with Internet Connection

This one is somewhat obvious, but still worth noting. You need a smartphone, laptop/desktop, or a tablet/iPad with a working internet connection to be able to run the trading software. This won’t be too much of a problem for most traders – if you can read this article, then you probably have what you need. Of course, if you’re using someone else’s device or internet connection, you’ll need your own before you can get started. Try to be sure that your internet connection is strong as well, otherwise it could cause issues. Note that some providers will allow you to upgrade your package if it isn’t working fast enough.

A Broker

The last thing you’ll need is a forex broker. There are hundreds and thousands of them online and readily available. You’ll need to do some shopping and comparing, however, as some of them might charge high fees or require a deposit that is larger than what you’re looking to invest. Choosing a good broker is essential for success, so be sure to put a lot of effort into this step. Some brokers are more interested in individuals with a lot of funds to invest, but you should be able to find a beginner-friendly broker easily.


If you want to become a forex trader, the good news is that the things you need are fairly accessible. A device with a working internet connection and a broker are easy to obtain, and you can get your education online for free if you put in the effort. Coming up with an initial investment might be more difficult, but you can still get started with around $5 and work your way up to investing larger amounts later on in your career. Becoming a successful forex trader is an obtainable goal for anyone that is determined and willing to put in the hard work.

Beginners Forex Education Forex Basics

What We Can Learn from Billionaire Trading Legend George Soros

If you want to get really good at something, it helps to take a few tips from the professionals. In this case, we’re looking at professional trader George Soros and the methods that have made him successful. If you haven’t heard of George Soros before, here are a few quick facts you should know:
George Soros’ current net worth is 8.3 billion dollars.

-Institutional Investor Magazine named him “the world’s greatest money manager” in 1981.

-He earned the title of “the man who broke the bank of England” in 1992 when he made more than a billion dollars selling the pound sterling.

-George Soros is co-founder and manager of the Quantum Endowment Fund, which is an international hedge fund worth more than $27 million dollars.

As you can see, George Soros has had a lot of success and experience in his 40+ years of trading. Many traders aspire to be sitting in his place one day in their future. The best way to follow in this successful businessman’s footsteps is to study the way he trades and manages his funds.

George Soros is a short-term speculator, meaning that he purchases assets for short periods of time and uses strategies to profit from changes in the price. His strategy involves making huge bets that are highly leveraged in the direction that he believes the market will go. The hedge fund we mentioned earlier is famous for making large, one-way bets on the movements of assets based on macroeconomic analysis.

Macroeconomics combines economic trend analysis, long-term projections, analysis for alternate trends, the impact of fiscal/monetary measures, and simulations of the economy. There’s a lot to it, but the internet has a lot of helpful information that covers macroeconomics so that all traders can familiarize themselves with the concept. Soros believes that traders themselves influence the market fundamentals and that their irrational behavior leads to booms and busts, which offer investment opportunities.

Although we can learn a lot from this investor, everyone can’t mimic his strategy. In fact, most wouldn’t be able to do so effectively. This is partly because he makes massive trades that would be beyond many trader’s abilities. The man is a billionaire after all. Another thing that could stop one from copying him is the fact that he uses high leverage on his trades. Leverage can obviously work to one’s advantage, but it is often referred to as a double-edged sword.

Overleveraging trades has caused many traders to wipe out their accounts completely because it is very risky. We would only recommend using a high leverage ratio if you are a skilled investor that can afford the risks that go along with it. A good way to become more acquainted with leverage would be to trade from a demo account using different leverage options.

If you aspire to be one of the greatest traders in the world, it helps to take notes from the experts. George Soros is the perfect example of a self-made billionaire that has launched himself to success through trading. Many traders look up to the businessman and want to copy his strategy. The bad news is that his game plan cannot be mimicked by just any trader. Making huge, highly leveraged bets requires experience, bravery, and obviously one would need a large sum of money in their account. Some traders might have the resources to do this, but those that don’t can still take some very helpful tips from the billionaire.

Consider his belief that booms and busts are caused by trader’s irrationality. You could also study macroeconomics and plan your trades based on that information in order to trade with the same thought process as George Soros. In conclusion, every trader could one day find themselves sitting in the same place with a lot of hard work and determination. Even if you can’t follow Mr. Soros’ strategy exactly, his success can still offer some important trading lessons.

Beginners Forex Education Forex Basics

Accept It, There Is No Holy Grail In Trading

The Forex markets are its own beast, many traders will say that at times, it just does what it wants with no real reason behind it. It is also something that can be influenced by the big banks (to a degree) so why are we still looking for what we would call the Holy Grail? If something cannot be tamed, if its conditions cannot always be mastered, then would such a thing actually exist?

The short answer to those questions is no. It does not exist and it never will exist. A huge part of trading is losing and any profitable trader will tell you that they still make plenty of losses, their strategy just allows for it and they make profits overall. So why can’t there be a holy grail of forex?

The market is uncertain and unpredictable. The markets are fluid, they are prediction and there are thousands of factors that come into play that can cause it to shift up or down. A human mind is an incredible tool, but even that will struggle to take into account and calculate the thousands of variables that come into play when looking at the markets. Unless you are told by a major bank what will happen (which is illegal), you won’t be able to predict certain events such as economic news events and certainly not natural or man-made disasters. So, the mind cant do it, why cant a computer? People have tried to create robots in order to trade, but again, the computing power and the number of information sources needed would involve a lot of computing power, not to mention that even the robot won’t be able to predict the aforementioned news events and disasters that often rock the markets.

And then there are market influencers. The markets are full of thousands if not millions of people trading, and due to this, they have control over the movements in the markets. So this doesn’t necessarily mean that humans are deciding where the markets will go to, but we are certainly influencing it in ways which according to data would seem unnatural. There have been times where the data has been incredible negative, all signs points to a fall in price, however, the markets continue to rise, against all the available data. This is simply because the traders in the markets are still buying, of course it should eventually come down, but due to its nature, this is unpredictable and no one can say exactly when it would.

A strategy cannot be profitable in all scenarios.The reason there are so many strategies out there is that no one strategy can be successful in all situations if there was one, then it would be the only strategy being used, and unfortunately, that would completely kill the markets and they would be at a standstill as everyone is using the exact same strategy. Patterns often repeat themselves over time, the markets can be seen as cyclical which is only broken by huge events. Most strategies that we know work for certain patterns in the markets, as soon as it shifts to another the strategy no longer functions to its fullest and so adaptations or completely new strategies will be needed for the new pattern that is forming.

So while there is no holy grail to trading, no way to be 100% profitable and no way to always win, it doesn’t mean that you cant be a profitable trader overall, the losses are part of trading, adapting strategies and having multiple at hand is the key, but also knowing when not to trade. Control your risk, protect your account and whatever the markets are doing, you will be able to profit in them.

Beginners Forex Education Forex Basic Strategies

What to Consider Prior to Changing Strategies

At some point throughout your trading career, in fact, in quite a few points, you will be required to change up your trading strategy. While it may have been working really well at one point the markets will not remain consistent forever and they will change, you will then be required to change with them, if you do not, then you are putting yourself into some additional risk and could be putting your account in danger, as your strategy may not be as effective in these new conditions as it was in the ones that it was created for.

There are a number of different things that you can do to help you prepare to change your strategy, these can either be used to help you to alter your current one or some of them can be used to help you adapt yourself in order to use a completely different strategy that varies a lot from what you are used to, so let’s take a look at what some of these things are that could potentially help you change your trading strategy.

The first thing that you need to be able to do is to understand why you need to make a change, there could be a number of different reasons for this. Maybe you are currently risking too much of your account per trade and so you need to scale back your lot sizes. Maybe the markets have shifted, your strategy worked well before but there are now different trading conditions that it may not function at 100% in, so you need to make some changes to match the markets. Maybe you need to change things up because your risk management isn’t quite working or your risk to reward ratio is not quite right, whatever the reason is, you need to have a good understanding as to why you need to make that change, once you know the reason, it will be easier to focus your changes on what will resolve the current issue, rather than changing things that may not actually need changing.

It is important that you only make a single change at a time, while there may be multiple different things that need changing for your strategy to be ready, it is important that you only do it one thing at a time. The reason for this is that when you make changes, they can either work or not work, you do not want to be changing 5 things at a time if one of them is not working how will you know which one it is? When we are changing just one thing at a time, we can see straight away whether that one change is effective or not. If it is not, then we can adjust again, if it is then we can move onto the next thing to change. Of course, changing some things can then also affect something else that you had previously changed, but at least when doing it one thing at a time, you are able to better track what the effects of each change are and whether individual changes have worked well.

You also need to have a good understanding that once these changes have been made, you cannot just leave them, things will be constantly changing so you need to be prepared to continue to make changes as the conditions of the markets continue to move on. A strategy is never complete, this is something that a lot of traders see to forget, no matter how much you have worked on it, it is not complete, there will always be things that need changing and adapting, this is due to the fact that the markets will never stop changing themselves, you must stick with them no matter what they decide to do. So while your strategy has been changed and is now working, you will need to make further changes in the future. I mentioned that a lot of times just then, hopefully, that helped it to sink in, once again, the markets will always change, so you will always need to adapt your strategy.

So you are looking to make some changes, where are you going to do this? Are you going to make the changes directly onto your life account or are you going to implement the changes onto a demo account? Hopefully, you went with the latter option. You should not be making any changes on a live account, you do not know what effect these changes are going to have on your strategy or the profitability of the strategy. This is why we always test all changes on a demo account, if it works, fantastic, we can then move them over to the main account, but what if they do not work, and we are using a demo account, it makes no difference to our live account, we can just revert back and try again with zero risks. If you were to attempt this on a live account and it goes wrong, then you have put your account in danger and could potentially lose a lot of money if things go wrong and you cannot rectify it.

What if you need to go with a completely new strategy? One that you have never used before. You have been using your current strategy for quite a while now, so making the huge leap onto a completely different strategy can be a little daunting. Some of the reasons why you may need to do this could simply be that your current strategy does not suit your style of trading, or it does not work in the current trading environment. When you make such a huge change, it can be hard to forget some of the things that you had been using in the past. You need to understand that you are starting fresh, ignore all the little things that you may have done with your previous strategy, you need to follow the new rules that you have set out and only those rules, when you try to take in some of the little extra things that you did with your previous strategy, there is a good chance that they can contradict the things that you are doing with the new one, so stick to the new rules, not the old ones.

Going along with the above when you make small changes to your strategy, it can actually be quite hard to get old habits out of your mind, you are so used to doing the same thing over and over, as soon as one little bit changes, it can be hard to adapt to that. This is far more prevalent in those that have changed just one thing if you have been using your strategy a certain way for a long time, you can naturally want to do things the old way, you need to set reminders about the changes that you have made. When you change your entire strategy, it is easier to remember the changes than it is when you only change a very small part of it. So set yourself reminders or put something up on the wall to remind you of the change that you made and what you need to do to stick with it.

So those are some of the things that you should be keeping in mind when you decide to change up your strategy or even go with a completely new strategy, it is important to know that you will need to keep on adapting and so getting these things into your head beforehand can make thing booths easier and safer when you eventually implement any changes.

Forex Forex Risk Management

Swing Trading ATR Risk Management Guide

Risk is essentially one of the crucial factors which have the power to endanger your entire forex trading career. Understanding how poor judgment and unsafe decision-making can impact individual accounts is key for all traders, be they at the beginning of their trading experience, or be they professionals. Because of the topic’s profound importance, this article will also discuss how each trader should address limits or at what point they should stop investing more money. Besides stressing the need for developing a wise and safe approach, we are going to provide practical advice on how to use the ATR indicator in order to assess risk levels in your trading and help you analyze how much pip value you should use in every trade. In addition, you will find out how many trades should be open at the same time as well as discover a comprehensive list of instructions that will save you from overlooking any high-risk aspects of swing type trading in the fiat market.

Processional traders often point out the importance of creating a detailed plan which naturally includes thorough risk assessment. A great number of traders nowadays appear to be focused on trade entries alone, which repeatedly leads to one of the three outcomes – a severe money loss, a break-even, or a barely significant gain. Such an approach neither allows these traders to grow their trading skills and reach the expert level nor does it help them build their finances as they imagined at first. Therefore, to prevent yourself from making the very same mistake as the majority of traders who experienced the above-mentioned scenarios, you need to take an entirely different approach to swing trading and invest in learning about the steps successful traders take to maintain their trading expertise and financial abundance.

Before proceeding to what makes a successful trader, let us first examine the choices that can hinder a forex trading career. Primarily, most of those who fail at forex either do not have a set risk or they opted for a random number without any prior logical analysis. The risk involved in trading is, in this case, a rather loose category as it depends on how traders feel, whether the previous trade was successful, upcoming news events, and other transient factors. To make matters even worse, this group of traders frequently does not stop after a loss, but they continue on to chase another win, thus entering a vicious circle of illogical thinking, occasional wins, and great losses.

When a trader does not include risk in trading, this individual inevitably imperils his/her account. We often see how a trader loses 20% of their account and believes that immediate return to the initial break-even point is possible. This, however, is highly unlikely considering the fact that such percentage equals some of the most successful traders’ average annual return. Bearing in mind the factors that led them to this stage, the probability of these traders suddenly becoming that good is very low. Unfortunately, despite it being a very common scenario, this challenge is one of the most difficult to surpass. Therefore, if your value dropped by half, from 50 to 25 thousand USD for example, you would actually need a 100% return just to get to your break-even, which is very much impossible at this point.

In case you are facing a similar problem, the best step you can take is to withdraw from trading, start all over again, and learn more about this market. This is such a specific situation and such an important signal that some traders should consider moving on to some other markets or businesses. Having this outcome directly indicates that a trader has not developed the necessary mindset which this particular market requires. Both reckless trading and the timid one may equally endanger your account because the risk can never be too high or too low in the forex market. Even if you managed to increase your account by 4% in a single year, it would still not be good enough if you had to go at great lengths to achieve this. Traders need to find that right balance and also think of some other factors, such as time, effort, and profitability, because there may be a safe but much easier, faster, and more lucrative way to seeing your finances grow.

This market is not risk-free, so it all boils down to the question of whether doing trading has a point. If you see that your finances are not developing accordingly, you may consider doing demo trading to learn how to set risk sensibly. If you have yet to do demo trading, you should bear in mind that this will help you build your system, psychology, money management, and trade management skills so that your account reflects these in a positive way and that you can transfer and exhibit the same level of skillfulness in real trading. Both demo and real trading, however, should not be void of risk since the most prosperous traders take many risks, but they know how to manage them properly, successfully minimizing the chance to fail. Consequently, the word risk does not imply that you are acting carelessly, but that you are intelligently assessing where you can invest to have financial benefits.

As risk is a necessary part of this line of business, but also the one that we need to control, we have to consider which percentage of the account any individual should be trading. Most of the available sources advise traders not to go above 2% of their entire trading accounts on each trade. Nevertheless, what this means is that the suggested percentage is the maximum limit, not the average one. While your stop loss should always reflect this, you can feel at ease knowing that most losses rarely exceed this amount. So, if you have 50 thousand USD, the 2% value would equal 1000. Although this may seem like a large quantity of money, and thus a large amount to risk, we need to understand that timid trading will not get you far and that you will not lose the entire thousand even if you happen to fail. Therefore, what understanding risk means is that every trader should allow themselves the opportunity to take risks, but also apply a strategy to minimize those risks.

To successfully track and control the risk level, you can always rely on the ATR, an indicator that tells traders how many pips on average a currency pair moves from the top to the bottom of the candle. While this tool cannot exactly predict the future, it can assist traders with money management, seeing how a currency pair is moving at present and what direction it may take later. Some of the best traders in this market suggest that the stop loss should be set at 1.5 times the ATR (default MT4 settings) value at the moment of position opening to see the greatest benefits, on the daily timeframe. Therefore, if a currency pair’s average true range (ATR) is 80 pips, the stop loss should be 120 pips away from the current price. With the help of this tool, you will always be able to set your stop loss and secure your trading, although once your profit starts to accrue, this limit is going to change.

How can we find out what the pip value is going to be? Even though we cannot expect to have the same pip value across the chart, what you can do is see how much the 2% of your account actually is. As the account will keep increasing and decreasing in value, the risk limit is naturally going to follow these oscillations. Afterward, we will need to count the 1.5 ATR of the currency pair and put the stop loss there. The last step to take here is to divide the risk (a dollar amount) by the 1.5 ATR (pips amount) to learn how much money you should put per pip on each trade. You can rely on this simple calculation for each trade you enter and apply it in your daily chart to get specific insight and information.

Most trades do not involve exact numbers, so let us say that your net account value is 50,263 USD. To estimate the risk, you will multiply this number by 0.02. Upon calculating the 2% of the account (roughly amounting to 1005 USD), we will seek the currency pair we want to trade and find the ATR only to multiply it by 1.5. If your ATR is 86 as in the example below, you should get a pip stop loss of 129.

If you focus on the tip of the pointer, you will see that the price is at 1.1707. We can, in this case, decide to go long, which is why we are going to use this number and deduct 129 (we would do addition if we were going short) to learn where we should enter the stop loss order. Finally, we are going to calculate the pip value by dividing 1005 by 129, which approximately equals 7.7 USD. After acquiring the necessary information, we know that one pip equals $7.7, so we can estimate that the trade unit value should be 78,000 for the EUR/USD currency pair, or 0.78 lots. We will insert the stop loss afterward and enter the trade, as shown in the image below. Note that in the MT4 platform you can use different tools published on the MQL 5 market for this purpose to automate the whole process. There are even some EAs. If you want to really get this easy, try to use Tipu Stops and IceFX Trade Info panel so everything is precalculated for each asset. Just use the drag option to the Stop Loss line on the chart.

While this is a secure way to assess risk, you should always look for the right indicator which will signal you to exit bad trades on time. What is more, you should previously make use of an indicator that can tell you that you are on the right path and inform you that you should stop trading before your price hits your stop loss. By researching and creating your own indicator algorithm, and combining these confirmation and exit indicators as well, you will successfully trade in this market and mitigate the amount of incurring risk.

In terms of how many trades we can do at the same time, the information provided by professional traders suggests that any individual can enter as many trades as they want under the condition that the 2% rule is applied. However, we should also be mindful of the fact that the same currency is not to be traded more than once at the 2% risk. Even if your chart is signaling that you should be investing in a particular currency, you should not by any means be investing in several pairs involving this particular currency (e.g. EUR/USD, USD/JPY, and AUD/USD) long or short at the same time. Should you fail to abide by this rule, you will suddenly have 6% of your account on this one currency (USD) and, having done this, you have actually taken on too much risk all at once. In case this currency goes the opposite direction, you may be damaging your account to an irreversible extent.

Therefore, despite the fact that this approach has been used by various professional traders, you may want to pay close attention not to fall for the trap of over-leveraging. To avoid making this mistake, you should always follow the first signal for that particular currency. Should you, then, receive a long signal on the EUR/JPY pair and another long signal on the EUR/AUD one, you should opt for the one you saw first and follow through. Although we may see the opportunity and potential financial rewards, sometimes less is more in this world. Having said this, you can also apply the half-and-half approach and put 1% on each pair, which can almost function as a hedge saving you from loss should one on the pairs fail to bring you profit. You may also decide to take half the risk and wait for another trade as you can see some favorable progressions coming your way soon, which is not something professionals would advise you to do very frequently because you may be stopping yourself from earning sufficiently by trading timidly.

Risks have often been disregarded as inherently bad, but in the world of forex trading, we know that they are unavoidable and necessary to make a profit. By adopting these practical steps in your everyday trading, even if you are doing demo trading now, you will learn how to set the risk level properly, without protecting you too hard from failure or playing recklessly. A smart trader is thus not the one who fears risk or casts it away as an unimportant factor, but the one who deals with it effectively, applying the strategies discussed in this article intelligently and consistently.

Beginners Forex Education Forex Basics

Tips for Trading During the Holidays

Most of the fellow traders have the same question on their minds around the new year. They have doubts about their way of trading when holidays start to knock on our doors. Some traders have been gaining pips throughout the whole year and they were constant in trying to sharpen and refine their game as much as they can. They were dedicated and they were making smart moves. With that kind of approach to forex, there will be very few worries on our minds. Naturally, we have the ones who are not that focused on their pairs and they’re practically gambling without any decent knowledge whatsoever.

Some people claim that the holiday season might be unprofitable for those with bad trading skills not just because they have poor trading manners but simply because the holiday is time for the break and that we shouldn’t chase money at that time no matter how our trades were successful. But we all need money all the time and especially during the holidays and somebody who wasn’t scoring constantly will try to make silly unrealistic trades around holidays just to catch that feeling of satisfaction and try to finish the year on positive vibration. So for all traders with different kinds of strategies and levels of dedication, is the forex climate any different during the holidays? Is December really a month where things dry up?

In our money playbook, we should aim for a 10 to 15 % yearly return. The stock market averages around 11 % a year but 10 to 15 % we consider as pretty good, of course, we would like to go higher if we can. This kind of consistent return year after year is something we should seek out for. The prevailing thought is that most people are away for the holidays and people are closing a lot of their long-term positions before the new year ends for tax reasons so because of that we have less volume. Less volume is bad for trend traders. How do we approach this? Historically observing, we don’t see a very good reason to make a whole lot of adjustments just because of the time of year we’re in. For example, December 2018 was pretty slow in terms of volume and overall movement in the market that we traded.

The stock market was near crashing back then and people were not officially panicked because they didn’t take their money out of the stock market and placed it into the forex market. There were sharp downward movements in the economy. But other Decembers before that have not been slow. According to our long experience, we have just not seen enough consistency year after year to warrant doing anything unusual in our own trading just because it’s December. This could be for a lot of reasons, we could have a lot of economic news that goes on in December that actually makes a difference. Also, most of Asia which is the most populous continent in the world doesn’t celebrate Christmas or Hanukkah or Kwanzaa so their world just keeps right on turning. This is where our volume indicators come into play.

Even if the numbers do add up and December is the slowest month of the year compared to the other months, the volume can certainly be there. Certainly enough volume to trade with. Volume indicator is crucial because it helps eliminate losses that we take along the way thus making our account making go up and up. The volume moves the market, we could say that volume is its fuel. The price has a high possibility of trending when there is a volume in the market and particular currency pair. When there’s no volume in the market or currency pair then the price has a little chance of trending. It is possible that for the price to trend without volume, but hardly, therefore we want odds to be on our side. They say that the good volume indicator is the main figure in a trading system and that we are not going to reach high branches without it. So we need to test as many as we can until we find one that consistently gets the job done as we want.

Once again, if there’s any lacking in volume, we might consider trade with less risk or simply not trade at all. So if we could determine these times around the holidays where volume is slow we should maybe take a break and do nothing. So far according to our research, there really wasn’t any significant difference between December and other months. On new year’s eve, we usually close out all of our open trades and wait for the new year’s break to pass, and soon after we re-enter the market. Better not to take losses if we don’t have to. This could be one voluntary day of inactivity out of all trading days of the year.

In the end, does it really matter when we trade? Probably not, because if we have the appropriate set of tools and indicators they will show us day by day if we should be trading. Even in late December, if there’s an opportunity out there our system is going to visualize that for us. Here we prefer to trade the daily chart exclusively. We believe this could be an advantage. For example, intraday traders could find themselves in a very difficult situation if volume occurs to be slow for an extended period of time. The volume they need is not going to be there and this could cost them a lot. If we trade the daily chart we could potentially recognize these times and know where are the opportunities as well in these slower months.

We need to eliminate the losses the best we can. We need to eliminate the situations that have a higher probability of giving us losses. We don’t want to control something if we don’t have to. So not trading during the holiday sessions and around December might be overrated. The most important thing that we could do is to stay disciplined no matter what happens. Traders, have patience, eyes on the prize, and you’re going to be just fine. During the holiday season if you have time to go in the market and check on your trades and charts go do that. And if your system is telling you to enter new trades go right ahead and enter them no matter what month it is. Go with confidence, always.

Beginners Forex Education Forex Basics

Is Forex Really Just a Game of Probabilities?

Many things in life are all about probabilities, forex is no different. The most well-known game of chance is the simple coin flip, it is thrown up into the air and you need to say whether it will land on heads or tales, a 50 50 chance, breaking down the markets into their basic form, there are only two possibilities on the direction that the markets will move, there is a 50% chance that the price will rise, and a 50% chance that the price will fall, but it isn’t that straight forward.

Every aspect of analysis within the forex markets adds a little probability one way or another, so the analysis is all about finding all the possibilities that there are and putting them on either the buy-side or the sell-side.

So what sorts of things could be seen as these probabilities? Well, everything, the current trend, news events that are coming up, the market sentiment, any analysis tools that you are using such as Bollinger Bands, Fibonacci levels and so forth all add to the probabilities that you have.

Probabilities also come into your trades, you have spent time creating that strategy that you are using, it has a 70/30 win/loss ration, so with the current market conditions you have a 70 probability of a win, you may lose two or three trades in a row, but the law of probability will dictate that you will win enough to bring your ratio back up to 70/30. One bit of newbie psychology is that a lot can put a dent into your confidence and can make you doubt the strategy, but looking at it from a mathematical perspective, you are in good shape for profits and will continue to win.

Being able to think of trading as a game of numbers rather than your actual money is the best way going forward, this will allow you to concentrate only on those probabilities in the long run and not individual wins and losses. Professional traders are not worried about the next trade winning or losing. What they care about is making money long term and over time. They want to maximize their profits by thinking in probabilities. Your edge, applied with consistency, should allow you to inch the probabilities of a winning trade slightly in your favor, this alone is what will allow you to win over time.

We know it is hard, but look at trading as small sections of probabilities, it will help to improve your trading and also help to take some of the emotion out of it.

Beginners Forex Education Forex Basics

Things that Forex Traders Take for Granted

When you start out with trading, you are often given quite a few different tips and anecdotes that people tell you. These are often things that are to do with your trading to things that you should be looking out for. They are more than helpful and they are things that you should always keep in mind, the problem is that when we have been trading for a while we often lose sight of them, or stop putting as much effort or sometimes simply ignore them completely which can have an overall negative effect on your trading. We are going to be looking into some of the things that traders take for granted but really shouldn’t.

One of the major things that traders often take for granted is the importance of proper risk management, it really doesn’t matter if you are new or an experienced trade risk management should have been ingrained into your mind. The problem is that as you see others making a lot more money or many extra pips each month, it can make you want to grab some of those yourself. It would be great getting all those pips right? The problem is that you are not currently in a situation to do this, so the only way for you to achieve that in a short amount of time is to throw your risk management out of the window, something that we know can have disastrous effects on your account and trading strategy.

So why is it that so many traders seem to forget about the importance of it? It can come from a few things, greed, envy, and overconfidence are the main three. They can all make you want more and to want to make more quickly. It is important that you are able to stick to the plan that you originally created, understand that it is paramount that you stick to it, it should always be one of the main things that you are thinking about when you trade and should never be put on the backfoot, so whatever you do, do not take your risk management plan for granted, it will only lead to disaster and the potential loss of your profits and even your entire account.

When you started trading you would have created a trading plan, much like any other person would have been instructed and recommended to do. That trading plan is what details everything about your trading, the entry requirements, the exit requirements, the risk management that you have in place, and your risk and reward ratios. This plan should be the thing that you follow for every trade, but you will be surprised at how many people take this for granted and begin to make trades that are notably in line with their trading plan.

When this starts to happen, things can begin to go downhill pretty quickly, and that is not a position that you want to be in. Your plan is there for a reason, your entry requirements are there for a reason, as soon as you start moving away from it you are making bad trades. People take their plans for granted and they also take for grants the reason why they have this trading plan. It is there to be followed so it is important that you follow it, if you don’t and you take it for granted, a good chance that you will begin to make some of the more common trading mistakes.

Another thing that people often take for granted is consistency, consistency is one of the most important things that can help to make or break a trader and a trading plan. Many traders completely underestimate the importance of staying consistent and sticking with your trading plan. Consistency is what allows a strategy to be profitable and to remain profitable over a longer period of time. Consistency also allows you to learn more about their own mentalities and the system that they are using. Consistency also allows traders to keep their results more consistent, as soon as you break that consistency you are skewing the results of your trades and account, you are also potentially putting your account in some additional risk which will ultimately only lead to losses in the long run.

There are also those that make things a little bit too complicated, keeping things simple can often make your life a lot easier and your overall trading experience a lot more enjoyable. When you start to overcomplicate things wither through too much analysis by looking a little too deep into the numbers, then things can begin to confuse you, you will begin to see contradicting information which can either confuse you or make it hard to actually make a trade. Try to keep things simple, use your basic analysis, and the requirements of your trading strategy only, do not try to add too many different variables into it. Keep things simple, do not take the simplicity for granted by adding a large number of additional variables or requirements, this I’ll only make your trading less fun and more tiresome.

The dangers and also your expectations can kind of be looked at with the same stroke. When we are starting out, we often make some expectations that are a little too high, a little bit unrealistic and we take for granted how important it is to set our expectations to a more reasonable and at an actual achievable level. Without doing this we are putting ourselves in a position where we may not actually be able to achieve what we want and this will only lead to disappointment and a loss of motivation. You need to set your goals at a level that you are able to achieve within a set timeframe, where you are able to measure it and also at a level that is realistic to your current skill and knowledge level. These goals cannot be to make $1,000,000 overnight, as that just won’t happen, see them properly and you will continue to have the motivation to reach them as well as being able to see the progress towards them, which is vital for someone working towards any sort of goal in their life.

So those are just some of the things that [people seem to take for granted, often on a subconscious level, they look past them or completely ignore them in their pursuit of better profits or better results. It is important that you never take the things that you have learned for granted, always use them in your everyday trading, use them to develop your own trading skills, and use them to help you remain profitable and consistent. Taking things for granted at any time in your life will put you in danger and this is very true for things like trading in forex, taking things for granted and you are risking your account and any money that your currency has in it.

Beginners Forex Education Forex Basics

The Importance of Being Consistent While Trading Forex

Just like with many things in life, being consistent in what you do can pay off, and deviating from your standard routine and style can leade to disaster. While it may be valid for most things in life, achieving it within the forex trading markets is far easier said than done.

When starting out, you will often be told that you need to find your own strategy, you need to stick to your plan and that you should not trade outside of it. These are all fantastic tips for staying consistent, but they do not really help you to do it, as the temptation to deviate can get the best of us into trouble within the choppy waters of the forex markets.

So why is it so important to stay consistent?

To put it simply, it helps you to maintain your strategy, your confidence, and your results. Let’s imagine that you have just spent the last six months perfecting your very own strategy, you use a number of entry criteria and a number of different exit criteria which are all based on certain patterns or values within the markets. You put it into practice and have now started making small, but consistent profit, for the sake of this example, let’s say £100 per week.

You are using a fixed lot size of 0.1 lots for each trade, and risk a maximum of 2% of your account per trade. You have now been making £100 per week for about two months, which is fantastic, but you want to scale up. How would you do this? Many would simply increase their lot sizes. However, you need to consider how this affects your risk to reward ratio, remember that your strategy only risks 2% of your account if you double the lot sizes to 0.2 lots, this increases the risk percentage, or the stop losses become shorter, wither way, your strategy has changed. So now your stop losses are shorter, trades have started to close in losses.

You have very set entry requirements, there are four or five that need to be met, they have been very accurate and very profitable, but the markets have not been optimal for your strategy, there have not been any trades for a few trading days. Would you stick to your plan and wait, or has the idea of making more profit got the better of you? You change your strategy slightly and get into some trades, but something did not match your criteria, now some trades are going up and some down, you broke your plan, and things aren’t going how you are used to, this can negatively affect your own psychology.

Even when sticking to your plan, there will be losses, it is important that you do not let this change the way you are trading, five profitable trades and a loss is still fantastic going, far better than many would do, so a few losses are simply the markets telling you not to get too confident, but rest assured that your plan is working.

Should you decide to change something, test it out on a demo account first, when you are sure the changes are effective, change them for all future trades, not just one or two, being consistent in your changes is also important.

Having these rules of trading is set by yourself and no one else, often these rules are created from mistakes, and as we all know, a mistake is the best learning tool. So when starting out, experiment, do things a little differently to find those rules, but once you have them, stick to them, you will thank yourself, and your account balance will thank you too.

The moral of the story is to simply stick to your plan, be consistent, and do not change things just because you want more or you are bored.

Beginners Forex Education Forex Basics

Losing Trades: What They Have to Teach You

You have probably heard it before, a losing trade is the best teacher, but what does this actually mean and who does it apply to? Well, it applies to everyone and it is actually true, a losing trade can tell you a lot about what went wrong, and using that information can help you to adapt your strategy and can even be a lesson to stick to it.

It should be pointed out that this will only work if you are keeping a trading journal, this journal will detail different aspects of why you entered the trade, what the conditions were like, what the entry criteria were, stop losses, take profits, what happened in the markets and many more aspects, using this information we can look at exactly what went wrong, so be sure to record each aspect of what you are doing, you won’t regret it.

Having a bad trade does not necessarily mean that you lost a lot of money, in fact, some winning trades could be considered bad, especially if they go against the strategy that you are meant to be using.

When a trade goes the wrong way and hits your stop loss (because you are obviously using stop losses), we need to know why that happened, was your entry criteria not fully met? Was there some economic news that you did not know was coming? We need to ask questions like that and with the aid of your trading journal, it will make it far easier to pinpoint the exact place where the trade went wrong. We won’t always win, and the markets won’t always react in a predictable manner to some news, so understanding what you have done is paramount for your own learning.

Sometimes a trade may go well and you make a profit, however, if you did not stick to your strategy, it was mainly just luck that it didn’t go the wrong way. Have a look at the reasons why you deviated from the strategy, were you distracted? Were you bored? Any of these reasons is not a good reason to get into the trade, use this as a reminder, you got lucky, but you need to stick to your plan.

We have all been in that situation where we did something and we either automatically regrets it straight after putting in the trade, or a day later wonder why we did it. Askingthr4se questions and consulting your trading journals will help you answer these questions adn hopefully allow you to avoid making the same bad trades in the future.

Beginners Forex Education Forex Basics

How Forex Trading Is A Bit Like Hunting

Depending on the way that you trade it could be considered a lot like hunting, here are a lot of similarities around the two. When hunting your prey is an animal, but with trading, it is a completely different type of beast, it’s the markets. We can take a lot of the skills required to be a good hunter and adapt them to be used with trading which could potentially help bring you in some successful trading. So let’s have a look at what sort of skills and traits could carry over from hunting to trading.

Understanding Your Prey

When hunting, you need to get a good understanding of the prey that you are going for, the way it behaves, the way it may react to certain things, and also how it moves. The markets are very similar, each market and currency pair will behave in a completely different way and different things will cause them to act in different ways. Getting a good understanding of the one you are looking at is vital for analysis purposes and also to know about where to place your stop losses and take profits. So before placing a trade, get to know what influences the market that you are looking at and which economic reports or news events may cause it to run in a certain direction.

Create a Plan

When hunting, you aren’t just going to charge straight in with your gun or knife and fire at the prey. You will instead come up with a plan, a way to lure the beast, or a way to hide and wait. The markets are very similar, you cannot just jump in with both feet and begin placing trades. You need to create a plan, how you will trade, how you will analyse the markets, and how you will protect the account should the trade get away from you.

Wait for an Opportunity

Hunting can require a lot of patience, as you cannot just charge in or fire at something that isn’t there yet, you must be able to wait until the opportunity comes. Trading is very similar, there won’t always be opportunities to trade, there will be times when the markets are very quiet, in these situations you need to be able to display some patience, wait for the conditions to change into your favor and then when they do, it will give you the opportunity to strike.

Monitor the Situation

Things do not always go exactly to plan, maybe your trap didn’t catch it, or your first shot missed, this is the time where you will need to adapt in order to get the kill. It is very similar to trading, the markets won’t always move the way that you expect them to and things may need to be changed. Hopefully, your trading plan has a contingency in it and tells you what to do if something doesn’t go right or if things change. Maybe you need to let the trade or prey go, or maybe you need to adapt and go at it another way. It is exactly the same with trading, constantly analyse the markets, and adapt your trade to suit the markets, don’t try to force the original trade that you had planned.

Learn from Mistakes

You do not start hunting as a master hunter, in fact, your first few hunts you probably won’t come back with anything, this is the same with trading, you will make mistakes, there is no doubt about that and you will make some initial losses at the start. When a mistake is made, then learn from it, use it as a learning experience, maybe certain lore didn’t work or maybe your entry wasn’t quite right, so learn from them and adapt it for the future. This also goes for things that work, if something went well, write it down and remember it, it could make the hunt or trade a lot easier in the future as it will most likely work again.

So those are a few little things that are similar between a hunter and a trader, it is all about planning, execution and then adapting to changes, the markets will always be changing, so having those traits in your arsenal will help you to adapt with them and to remain profitable.

Forex Psychology

What Is Your Body Trying to Tell You While Trading?

Forex traders often think that trading is all about your mind, it is your mentality, your intelligence, and your discipline that will make you successful, and they aren’t wrong. Those things absolutely do have an impact on your trading and they are vital if you want to be successful and profitable, however,r there are also other things that you need to take into consideration, things that your body will be telling you about, so we are going to be looking at the different signs that your body may be telling and why you should be listening to your body if you want to b a successful trader.

One of the more obvious signs that your body can be telling you is that you are tired, sometimes within our mind, we may be fine, but when your body begins to ache, or you find it slightly harder to move about due to a lack of energy, this is your body telling you that you probably need a break When your body is in this condition, it will begin to distract you from your trading and that is the last thing that you want to do, so if your body is starting to feel tired, be sure that you listen to it and take a break.

Sitting at a desk or in front of a computer for extended periods of time can make it quite hard to maintain your posture, this can lead to a number of different issues with your body, the most prevalent being aches and pains. If you start to feel these, be sure to take a break and stand up, much like when your body is feeling tired, you need to be able to get up and give your body new positions, go for a walk, or just simply stand up, that change in posture and stance can really help your body to recover from those aches and will allow you to fully concentrate when you had back to your trading platform.

If you are easily losing concentration or are becoming increasingly easily distracted then it may be time to take a much-needed break, you will often begin to feel this way if you have been doing something for an extended period of time, it is not healthy to do any one thing for too long, so if you are losing your concentration easily, then we would suggest that you take a step back and take a break, if it is late, call it a night as you should not be working or trading into the early hours of the morning anyway.

If you are waking up in the morning tired, then your body is telling you that something is wrong. Your body is either telling you that you are not sleeping properly or getting enough of it, or that you are simply working too hard. Mental exhaustion can carry over for a number of days, even with a day of sleep, you need to be able to develop a schedule that gives you enough breaks and ensures that you are not working too hard on your trading, the exhaustion will only continue to get worse if you do not.

Your body can sometimes give you clues as to your current emotional state or what you are thinking even if you do not know entirely yourself. Little muscle twitches, different breathing patterns, and things like clenching your fists are all things that could indicate to you that you are going through an emotional change. Being able to recognise these little and often subtle changes can give you a headstart on avoiding the emotions which could potentially cause you to make rash or dangerous trading decisions.

There are of course a lot of other things that your body could tell you, but those are some of the more obvious. It is important that you take notice of them, your body is there to help you if you feel tired or ache, take a break, just be sure not to push yourself too hard, or the results will only be negative on your trading account.

Beginners Forex Education Forex Basics

The Forex Experience: What to Realistically Expect

What is makes you an experienced Forex trader? Is it because you have tested thousands of indicators? You have built a system with positive backtesting results? You are have invested a lot of time onto becoming one? If you are not exceptional, you will not be a good one until you have the last element – experience.

Now, you should not be discouraged if you have put a lot of time into making yourself a better trader, even if your system does not show great results. If you got up to that level, you are on the right path, for the next 30, 40 years and more, your life will be financially free. This also induces stress-free and even can be said a healthy life for the long term. Fortunately and unfortunately, depending on how you look at it, money solves many of the problems today. Forex is a blank slate, the internet is also, giving you the opportunity, it comes down if you want it.

And, yes, there are no shortcuts, no easy way to get to this level. Those that seek that easy path will ultimately meet failure. You have invested so much time into Forex trading that you now have a chance to be very close to what is regarded as a “dream job”. Those that reach it are very few, just look around and see all those busy people on the street hasting to get to their workplace in time. A sad truth, many will be frustrated and wonder “why I could not achieve that life I have always wanted”, and they see others do it, just why not me. The opportunity was there, you just didn’t act. Forex is that opportunity, and it will allow you to start again, everyone has the same unpreferred window to study it as long as you live.

Many traders who put in the work, a lot of work, experienced frustrations, and many other negative emotions that are just part of gaining experience. Traders will run into things for what they are not ready yet. It is just a matter of experience, there is no substitute for it. Going forward this article will give you a bit of insight into what to expect, addressing to those who are already into forex trading. All this comes from professional forex prop traders some tips and a practical tool many prop traders use.

Never forget the three pillars of trading: The most important ones are Money Management and Psychology. Trading Analysis is secondary, a far secondary. There is a proven methodology that shows this is the truth. You can throw a coin for every decision to go long or short in a trade, with good Money Management which is followed to the letter, you will still have positive results. Without the right mindset or Psychology, all this can go to waste. Unfortunately, most people just focus on the secondary part, Trading Analysis. Not a surprise the 99% of people do not make it far to reach that stress-free life.

Just to make sure you are on the right trading, your trading system should have three stages. The first test is when you are just building the system and backtest it to make sure you have a much better winning rate than 50-50 as with a coin-flipping. The second stage is where your good-to-go system is put on a demo account and forward-tested. In the third stage, when you step up and say you are ready, you go to a real-life test. You will make different kinds of mistakes in the third stage, and that is alright. This is the experience stage where you will mature as a professional trader. The experience will unavoidably forge you to avoid future mistakes.

At this point, you may think you will not make mistakes, you have made the system that works, but, once it gets serious with serious money put in the trades, it is a completely different world. Forex will be the same market as before but now you have new challenges you have to be ready for. These challenges will be emotions. You better make these emotions happen in the past before you move on but still, some will be new to you. You may have just started to trade your system/plan and you have 4 bad losses right away. The mistakes made will be remembered especially if these decisions were emotional. But this is a good thing and part of gaining experience in a real professional career. Whatsmore, you will have a huge motivation to improve your system.

Know that your system should always be perfected, it is not a holy grail for eternity. Your system is no just a series of indicators for analysis/signals, it is also your emotional control anchor. Trading your system sounds easy but it is not, experience gained from this is essential. Once you realize you had overcome the new emotional challenges, you will realize the Psychology element is the grease for your trading machine. Stop greasing it and it will halt. Confidence will also grow with experience, as well as your balance. Once you have done 1000 trades you will know that the series of big losses you had before was just a normal or nominal statistic.

Every gaining equity curve has these drawdowns, it just happened the drawdown was peaking when you started. Of course, you did not have the experience so you were living in that moment, you doubt is the system works in the first place. At that moment traders do not look at the long game. Once you overcome this, the next series of losses will not shake your confidence. As you move on you will face new challenges yet with every one of those “unforeseen” events patched up in your rule book and the system, you have improved. Those bad situations on the market will trouble you less and less until a few very rare things can surprise. Forex will go out of bad bullets eventually for you.

If you are on to a professional Forex trading career, your path was probably in four stages. The first one is all about demo trading. If you skipped right into real money trading, the odds are it was a huge loss. Consider a lucky event if you have withdrawn after a few great winning trades. It would be smart to stop at that point because you lack experience and the system for the long game. Do not return to live trading before building a system and demo trading. The experience will tell from the demo trading your system works but live trading is now very emotionally different. The third stage is when prop companies want your trading results (note that not every proprietary company needs this when selecting traders).

The best way to impress is by having a demo and live account trading results. At this stage, you have some experience and the system is tight for most of the market situations. However, your trading might be different. When you want to impress, some trades that made you successful off the stage might be missed. After overcoming this obstacle comes the fourth experience stage – actual live prop trading. This is a completely different set of emotions again. This happens to responsible traders, those who are not responsible and do not respect the money are filtered out. At this stage, someone is giving out their capital so your trading can enjoy the “economies of scale” effect.

Bigger equity, bigger trades, bigger responsibility. Losses will happen, they always do, and you might become risk-averse because of a higher scale of responsibility. From an inexperienced trader who went to live trading, risking too much and trading too much now has a risk aversion and trading fear. These emotions will catch you off guard, you might deviate and change your system. There is no other way except to face them, for experience requires time. If you are at this point know the worst thing you can do is turn back. The success rate in this business is so low you cannot afford to drop everything.

Here is a pro tip for traders at this point. These traders should have a system which is backtested, forward tested, and is used in live trading. This system should be considered that will last for life as a profit-making machine in the forex market. Even if you are trading for a prop company or still in the admittance process, put yourself to test – trade an uncomfortable amount of money with your system. By uncomfortable is meant an amount that will seriously hit your home funds balance if you lose everything. This may sound crazy and irresponsible but this money should be recoverable, especially if you have a job or other sources of income. When big money is on the line, this test will help you. Take it as a sacrifice now for the next 50 years or so of your life.

Once this is dealt with, there is not much that can stand in a trader’s way to become a true professional. This emotional experience is so important that it even can be crucial to becoming a professional trader. Forex requires you to lose before you can win. Loses will still be sour and winners sweet but the experience will control the emotions so your final P/L line is just a number. Most coaches will tell traders to hide the dollar amount tied with their trades and trade for the pips. Putting yourself in a very uncomfortable position or out of the comfort zone is beneficial, there is no substitute for that experience gained. This accelerates your learning curve. Some of the great coaches will also say traders are not born but forged. They are forged because they had to go through fire to get to the top.

The tool related to the situation where your system might not work for some time, especially if you are a trend following trader, is the $EVZ. Just a side note, if you are not using any known trend-following strategy, trend following is a way to go for almost all of the proprietary traders. CBOE EVZ volatility is a very important tool for trend following traders, especially on higher timeframes. Since the world where we live is cyclical, so is forex. There are periods of high, choppy, chaotic, low, and other volatility patterns on the market. Trend following strategies need momentum, volatility, or volume to work, this is how trends are created. Most of the traders will find that their system does not work very well during these low volatility periods. Losing streaks will emerge and traders will dip into the emotional zone. Experienced traders will recognize this period and probably will not trade until the volatility/volume picks up again. 2019 was the year of extremely low volatility on the forex market while in 2020 COVID-19 stirred extreme volatility spikes.

Extreme situations are new to you and your system. Do not question your system during these periods, take the $EVZ, and compare your results relative to the $EVZ value. As one prop trader suggests, his trend following system does not work well for anything below the 7.5 $EVZ. If the situation prolongs, like in 2019, he will cut the usual position sizing. If it goes below 6, he completely avoids trading. He may go to Metals markets or Indexes. Simply, the odds for a trend to run in the forex market on his daily timeframe are low so all he gets is breakeven at best. Another tip and always good for Risk Management is diversification. When you perceive low trading volume in the forex market, you can still gain trading Gold or Silver, for example. Metals market requires additional knowledge as they move differently but gains will also affect your emotional state. From a different perspective, the 2019 low volatility is a perfect testing ground for your system, traders that have endured and adjusted are now even more prepared, they have gained experience from an uncomfortable situation.

To conclude, never forget the importance of the Psychology pillar, 99% of people do forget. Experience is a failure and trying again, every top trader went through the forge. Embrace this fact and sky is the limit. Pay attention to the $EVZ and adapt to the situation, markets and economy are cyclical. Finally, do not panic if you make consecutive losses, it is just part of the long game if your system is proven to work.

Forex Basics

Best Advice from Forex Prop Traders

Most individuals working as independent contractors for proprietary funds are oriented to proven scientific methods not to just what is the best general advice for trading, but other activities as well. It may sound too broad to be useful but it is very practical. As per their words, this information or advice is very obscured in on the internet. You will rarely find forex trading “coaches” talk about this crucial mindset element to a trader who wants to constantly improve or even become a professional trader for a company. It is so important that your potential to become one of the best on the market will be shadowed if you have habits that will bust any trading account sooner or later.

This method is used by the most successful professionals in many different activities. Champions, tacticians, presidents, and millionaire investors know this, and they have become over time the masters of their game. The advice is simple: You need to avoid, eliminate, or improve factors that take your trading account into negative! Now, when we look at this it sounds like you already know this, no eureka here. But, surprisingly, most trading advice is oriented towards what could bring your trading balance up, completely putting the losses you will make out of the scope. Understanding and identifying looses is the first step and the work on measures that will cut them down.


Now let’s bring this into practice. Speaking of bad habits, every elite professional has them when they start their career. Over time, with good coaching and persistence, they eliminate bad habits that influence their trades. The same can be said for any other profession, our brains tend to react the same way over and over to the same situation or stimulus. Cutting the losing trades caused by these habits out of your balance has the same importance as finding a new rule or a trading tool to improve it. For example, let’s say you have 10 trades, 5 losses, and 5 wins equal in value, 100 for example. If your trading has this breakeven result, you are doing better than the majority of traders.

Now, you have incorporated a rule or a new indicator to your trading system that was able to provide you a new signal and another positive trade on top, increasing your balance to +100. Great, now let’s say you have avoided one of the losing trades by integrating a rule no to trade more than 2 trades on a single currency, for example. This avoidance made your balance +100, the same as when you find a better indicator. The problem is, we treat them differently. We will focus mostly on new and better tools disregarding the impact bad habits have on our account. The reason behind this could be your ego, it could be more interesting to focus on new tools or it could be that subconsciously you have a hard time changing your habits.

What is great about trading and forex is that it will ultimately be a reflection of yourself. How you cope with the randomness of the market and how you seize the momentum. Avoiding losses and finding tools that work well on your balance are what separates the elite from average and from those that never come back to forex. Finding the losing trades is easy, but having a tool or a rule to exclude them is what every professional trader works on throughout his career. When you incorporate a tool that brings you an extra win and one that cuts one of the losing trades your balance will be +200, and this will be a game-changer.

Having a bad habit will always turn your trading balance down, no matter how good your tools are. One of the ways to cope with them is by following three rules. These rules could be a shocker for you since there many videos and mentors that teach and rely on what is essentially wrong, as criticized by some prop traders.

Do not use popular tools, they do not work! Most of those tools you have used in the beginning are not effective. And these cover the internet all over for various reasons. One of them is just because we do not know for any better so we stick with them. The tools regarded obsolete by some professional traders are:

  • The very popular RSI
  • Also, very popular Trend Lines plotting
  • Support and Resistance lines
  • Chart Patterns
  • Bollinger Bands
  • Moving Average Crossovers (doesn’t mean MAs do not work per se, just crossovers)
  • Fibonacci
  • Fundamental Analysis (essential only to investors)
  • Japanese Candlesticks
  • Stochastic Oscillator
  • CCI indicator
  • Price Levels

You are probably familiar with at least one of these when starting and using some of them, if not all. It is not a surprise since the abundance of material based on them is just obscuring what could be a better solution for you. For die-hard RSI traders, this is hard to believe, but it could also be a habit of sticking to a tool they have used since doing their first baby steps into trading. Searching out for a better tool should not be too hard, at least for some of the above-mentioned tools. Many alternatives just work better. As to why these are not good enough is a separate article for each.

Trading on intuition. How many times you have traded like this on various aspects and had a feeling someone is rigging the market when it does not go your way? Many like this way, it is that feeling what rewards them when they trade positively, pushing them to do it again until they bust the account. These traders create gambling out of forex trading, it is probably just a substitute for a casino to them. This is a very undisciplined way to trade. Here is what usually drives a trader to go into the “feeling” trading:

The Fear of Missing Out – FOMO

The market will play tricks on your mind, you may start to feel some hesitation after a few losing trades. Let’s say you pass on the long trade you felt was right on some currency pair. After a calm price movement, you suddenly see that spike up, and it is going strong, fast. The price is already way over your initial entry level but you feel this is the one that will recover all of your previous losses. Of course, many of these trades will be just another loss. The probability is against you when you are late on the move, further reducing your outcome of a positive trade, and later on your ability to save your account. To cope with this, a well-made trading system with specific signals when to enter or close is something we have to build and rely on. This is how confidence will also grow to a point we do not have FOMO trades ever again. Also, eliminate losses produced by intuition trading.

The Overbought and Oversold guess by observing the chart. This is another common habit where traders just feel some currency is Overbought when they see some sharp rally. They do not have a definitive reason why that point is the right opportunity to open a reversal position. On top of that, currencies do not have limited supply like Gold or stocks to have Overbought economic pressure.

Exiting a trade on a feeling. Indicator telling you to exit or a news event could be a reason good enough, but exit on a feeling is probably just you wanting to have a “humble” reward instead of facing remorse of losing a profit trade you once had. The point here is that you have just limited yourself to have small winners that will not matter to your balance much in the long term. Reinforcing your feeling of exiting is further complicated when you guess the right moment. This prolongs the wrongful conviction of your intuitive abilities. Intuition simply does not have a place in forex trading.


You cannot rid of this since we are all emotional in some capacity. It is easy to say do not be emotional when trading. To manage them you will need time, and most of all, the system. Relying on a system that works is a remedy for your emotions. The system should be your final answer to all the questions the forex market will ask you. Even the professionals have moments of doubt when a series of bad trades come in, or even worse when an extreme loss hits them without any warning. Trading with a demo account may give you a feeling you have finally eliminated emotional trading with a good system. The emotions will come back again when you decide to put in your money, and again when you trade someone else’s money. The final master of your emotions will be your confidence based on your system that simply works, just stay out of the way.

Trading without a Trading System

When you have a definitive answer to all market situations, all of your guesswork, intuition, and other bad habits are swept away. All you have to do to keep that account growing is to read your plan and trade accordingly, without exceptions. Whatever your initial plan may be, it’s a great start and it will show results right away. Over time and with testing, your plan will evolve and bring more and more gains. Before you make your first Trading Management plan, which is not hard to do, you will need to avoid certain aspects as per the prop trader’s advice.

Not having a flexible or adaptive system. To elaborate, every currency behaves differently on the market and will have different pip sizes of trends, range periods, news event moments, etc. Having the same Stop Loss distance, for example, to all of them does not make any sense and will certainly impair your ability to do well on most of them. That 50 pips Stop Loss may work on the EUR/USD pair but will certainly be triggered more often on the GBP/USD simply because the GBP moves a lot more. Different timeframes also set different price action, your 50 pip Stop Loss on a 5-minute timeframe does not have any practical use since you will have many trends and spikes that could be cashed in with the proper Stop Loss.

Reversal Hoping

A trade does not go your way, but you feel it is going to reverse and you move your Stop Loss, again and again to the point your trade is a big loss now. You have just made your Stop Loss useless, and your Trade Management plan. The best advice on this is, apart from avoiding moving your Stop Loss, is let that trade hit it, wait for it and if it happens, move on. Now you have that losing trade that may help you improve your system later, losing is a part of trading. Like before, moving a Stop Loss and experience a reversal will just prolong your conviction you were right and go back to emotion trading. Resist this habit, you will most likely do it again but in time you will understand. Similarly to the intuition exiting when the trade is positive, exiting out of fear of Stop Loss being hit when a trade is negative is not going to help you become a consistent gain trader.

Limiting Winners

If you are familiar with Stop Loss and Take Profit management then you know about the Risk-Reward ratios. Most of the traders cap both sides of a trade, using a Stop Loss and Take Profit. This is a disciplined way to trade as you have defined positions for both according to the plan. Risk Reward ratios of 2 to 1 mean your potential profits exceed the amount of loss twice fold. Similarly when you put Take Proft to 10 pips distance and Stop Loss 5 pips distance. Unfortunately, this approach also limits your gains twice fold. Trends can extend way more than 10, 100, or even 1000 pips. These trades with extreme gains are the ones that will make an impact at the end line, no the small ones and you have just capped that possibility never to happen. This is why the ratios are not a good way to start your plan. There are better approaches to how you can have great Risk Management based on scaling out or partial position closing and moving the Stop Loss to breakeven.

The Trading Plan is easy to create following all these points. Let us say you are adaptive and have an indicator that measures volatility (ATR), set the pip value accordingly as the Stop Loss distance, for example, say it is 10 pips. Set your Take Profit to be 10 pips too but only to partially close 50% of your position and leave the other half uncapped. This way you can capture extreme trend moves and profits. Once your Take Profit is hit you can only win because you will also move your Stop Loss to breakeven, the price level you have entered. Even if the trend reverses and hits your Stop Loss at breakeven, you have captured that 50%. You have set up the first Risk Management plan that will evolve and work in conjunction with other tools you will develop. Prop traders usually have an indicator for every situation, when to exit, when to continue trading, when to enter a trade, when to avoid trading, and so on. Having this rule list by your side is not your pillar of confidence, every time you open a trade, follow this plan. Now, compare your results with and without a plan.

Source: No Nonsense Forex channel