Forex trading is a game of risk and extreme focus. It is not easy and requires a high level of knowledge and understanding before you can actually turn a profit. With its number, charts and ratios, trading is a science, and although a natural affinity is useful, it is practice and discipline that will help you to truly excel. There are lots of tools and resources out there to help but knowing how to use these tools can often be as complicated as what the tools are actually doing. They work by helping you understand methodologies and hypotheses in order to calculate probabilities, minimise their risks and maximise the chances of success.
Like most professions, there are different ways to approach forex trading. Some will take big risks and potentially make large profits in single trades (with the risk of losing a lot of money) while others will be very cautious and calculate every single move. Different styles of trading will suit some investors better than others, so it’s really important to find a methodology that suits your attitude, skill set and goals. There is certainly room for every type of personality in forex trading, however you must build on your strengths, rather than try and be someone you’re not. Being a bit of a risk taker sounds like a must for trading, however, if you are very scientific in your approach and love analysing data, you may find, you can trade without really taking massive risks.
There are lots of platforms available to you. Forex trading is big business and companies are keen to get you on board. Rather than picking a broker who offers you $100 free credit, look for the ones with great customer support, trusted platforms, mobile versions, useful tools and with a good reputation. Irrespective of whether you decide that fundamental or technical analysis is better suited to you, one of the keys to success is being consistent in your approach.
Understand what others are doing but don’t necessarily just follow them. Reading resources, blogs, and news updates can give you some great insights but remember to do your own research and develop your own understanding from various resources. Use demo accounts to test new ideas and theories you have about market movements. Use local tools as well, don’t just assume the big multinational platforms are the best option. If English isn’t your first language then use a platform that has customer support in your own country. Attend seminars and invest in yourself. Spending $1000 on a seminar may seem like its money down the drain but forex trading is a continuous learning curve so you must keep up-to-date on these things.