The Forex market attracts new traders every day. Many of them have never traded in any type market before.Forex is the largest market in the world and there are some major differences from other markets. I began my trading career over 20 years ago in the commodities markets, so I am not a newcomer to trading.. So here is a mini version of a Forex trading tutorial that may be of some benefit to new traders. Maybe some new traders can learn from a few of the many mistakes I have made.
You must have a detailed plan in place before entering any trade. Never deviate from your plan because the market did not behave the way you anticipated. The market is always right.
To be a successful Forex trader you must at all times adhere to your trading plan and be disciplined in every trade you make. Undisciplined traders don’t have long careers as traders.
Always trade with stops in place. Never adjust them to stay in a losing trade. Only adjust stops to protect profits already made.
You must learn that you, and every other trader, will have losses. It is inevitable. You are no different than other traders. There is no perfect trading system or perfect trader.
Never try to determine your profits in advance of entering a trade.
Both bulls and bears make money. Never be afraid to short a market if your trading system or indicators are pointing to a market about to go in decline.
Refine your trading system as you gain more experience. No system is perfect and your system should be tailored to your trading style as you gain more confidence in trading.
Don’t be afraid to stand aside from time to time. New trading situations come along every day. Wait until you feel that the odds are more in your favor before placing an order.
Trading is not gambling. Don’t approach trading as trip to Las Vegas. It is a business. Always treat is as one.
Patience is a virtue. Most big moves take time to develop. Wait for the market to tip it’s hand before jumping in too soon.
Greed is a surefire way to blow out your account. Always trade with a sound reason to make the trade before entering a market. Trying to squeeze extra profits out of a trade can backfire if the market suddenly changes direction.
Don’t over trade. Overextending your account will lead to a short career as a trader. Too much leverage on any trade has been the downfall of many traders.
Control your emotions. Rationally study market conditions and look before you leap.
Study your trading system and be familiar with the indicators, chart patterns, or price movements that signal a trade. Wait for your trading methodology to give a trading signal before entering the market.
The trend is your friend. Sometimes a short term trade against a trend can be profitable, but be extra cautious if making a short term trade against a strong trend. Temporary reversals of a major trend are traders taking profits and the trend will usually resume in full force. Have a quick exit strategy in place before the trend resumes.
Learn more about Forex trading and maybe a few Forex trading secrets at the author’s website.