There is no way to become successful at anything in life without proper education. Sure, chance does play a part in many things, but most of us can’t depend on sitting back and doing nothing in hopes that lady luck will come knocking on our doors.
As we all know, knowledge is money and nowhere does that hold true more than with Forex trading. Forex may sound simple and straight forward at first and anyone can open an account with a Forex broker and start trading. But to come out ahead and show real achievements, you must have enough understanding and familiarity with how Forex markets work and how to trade smartly.
So what should you do to prepare yourself to trade Forex?
1 – Learn
Take a course -online or offline- that teaches you everything you need to know to at least get started. You can begin with the basics but move on to some advanced classes because you will need to understand these concepts before placing your first trade.
2 – Choose a broker
That is not as easy as it sounds. There are so many brokers out there these days that it is hard to know which one is the best for you.
3 – Speak to experienced traders
Seek out their advice regarding which broker to choose and which features to look for. Ask them for tips on how to trade successfully.
4 – Open a demo or practice account
Most brokers offer a demo account, many with an unlimited time frame, where you can practice applying your new knowledge and try out new strategies. In a demo account, the broker allows you to trade with virtual money so you never risk losing your own funds. At the same time, trading in a demo accounts lets you gain the experience you need before moving on to a real account. It is a good training ground for both newbie and professional traders.
5 – A mini account can be used instead of a demo account
Not all brokers offer a mini account but those that do see the value in your opening an account with a very small deposit and letting time take its course. Beware accepting the high leverage offered by the broker. That is how he makes his money.
6 – Practice
Practice your trading for at least 6 months before opening a real account. Use whatever ideas and hints you have acquired to experiment in your account with small amounts of money only. Trade small and don’t use leverage. It will only put a hole in your pocket right from the get-go.
7 – Loss is possible
Always keep in mind that you will definitely lose your money at least 50% of the time. This is a given. But you should be able to make your money back by trading slightly larger amounts and being successful with them.
8 – Be yourself
Develop your own trading strategy and stick with it.
9 – Small trades
Keep your trades small. Don’t go overboard.
10 – Never let your emotions get involved in your trading
If things don’t go your way, stay cool and let the trade go. Placing entries or exits at the wrong time is a knee-jerk reaction that never leads to success.