The Best Way To Learn Forex Trading
So y’all want to Learn Forex Trading
Welcome to the jungle of scammers. The paradise of free money stories. The get rich next week heaven and the dream of quick wealth. Learning Forex Trading is not very hard, it’s very simple. The main issue for a beginner wanting to learn Forex trading is the overwhelming amount of information available about Forex trading.
You wanted to start learning Forex Trading, the first thing you did is surely open your browser and search the term Forex Trading. Well already here you did a major mistake. Why? Try and Google the term “Forex Trading”, the search will return 190 000 000 results for you. That’s when you’ll dive in the mess and the jungle mentioned above, surfing from one site to another, from one YouTube video to another. Soon you’ll feel very overwhelmed, confused and have no idea what is good, what is bad and how to move forward.
Try to be very specific from the start when you search the web to learn Forex trading. Why not try to google “How to learn Forex for the absolute beginner” now you are down in 39 000 000, well I hope you didn’t expect that you’ll get less than 25 000 000 cause you’ll never get below that. I think you got the idea here, so be specific, be very picky about what you read and watch.
So what else is there to do?
I’ll give you the first place to start, which will save you loads of time and effort. Let’s be clear I am not affiliated with anyone or any site I mention in this article. The first site you should visit as totally new to Forex trading is BabyPips. Now you surely wondering why a mentor who sells courses is sending me to another site? Well for the very simple reason, they did a great job as a place for beginners and for free. Spending money on any course as a new trader is a waste of your money. All the basics are out there for free. Babypips Forex tutoring curriculum is structured in a very good way, that is the main reason for me recommending it here. Now don’t get me wrong, there are many good sites out there, but I can only recommend BabyPips since I personally did research and read the whole course.
How to learn Forex trading the right way
Now you have a place to start at, that’s good, so what’s next?
Some points need to be clear from the beginning. Do not expect that after doing the whole course that you’ll be ready for Forex trading or any trading for that matter. Having realistic expectations is very important when learning to trade. Shortcuts won’t work here. This whole course will only give you a good base to start from.
Another important thing is to not rush through lessons. Read each lesson at least twice, try to test what been mentioned. Spend time on charts and do deeper research on things that interest you. But be careful of going out of track and back in the web jungle. This is the best time to test everything and anything, keep testing and playing around and do as much chart time as possible. During your first couple of weeks, you’ll feel very excited and full of inspiration. That’s good and bad at the same time, good, coz this is the time where you absorb it all like a sponge and bad since you’ll be eager to start hitting the BUY/SELL buttons on your platform.
Also during this period, you may get bored with all the reading and you move to YouTube to find some good videos. Be careful, there are many good channels on YouTube, but for now and since you probably still not able to find out what is good and what’s not. So again I highly recommend that you stick to the course.
Traps to avoid while learning Forex trading
Let’s say that you spent a month learning over BabyPips. If that is the case, well done! Most newbies would now be lost again in the jungle, also already tested at least 50 new indicators. So be smart and keep working on the course, do not rush it, do not try any indicators more than the ones mentioned in the course so far.
Stay away from social media groups. But if you find a good one, be sure to also be specific when asking questions. Also, be ready for silly answers and many people trying to sell you signals, indicators or an Expert Advisor (EA).
During this first period, you’ll think that Forex Trading is way too easy. In some way it is, and this use to be the time when you’ll do good, cause you doing exactly what you been taught and following all the rules. But be sure after this period when you start jumping from a strategy to another, finding more and more information you’ll start confusing things and you’ll start feeling lost again. So be sure when you find a style or a trading strategy that pleases you, stick to it, learn everything about it. If you are fortunate enough and find a strategy that works for you in the early stages, then do whatever it takes to stick to it and master it.
What is the best Forex trading strategy?
Again the wrong question to ask. There is no best Forex strategy, I really mean it and you’ll surely find out soon enough. Sorry if I sound negative here and probably disappointing you, I am telling you the truth and the truth only. What’s the best Forex strategy for me? Well now that is a much better question and the difference this time is there is most certainly the best strategy for you. Something that works with your lifestyle, or the type of the person you are. A person who works full time or studies full time, will not be able to trade a scalping strategy. A scalper needs to be on the screen for a long time during the trading session. While if you would find a strategy that works on higher time frames as the 4H or daily time frame, then you need to check the charts a couple of times during the day only, which is possible for someone that works full time.
So focus on finding a strategy that fits with your lifestyle and the amount of time you have for trading. There’s no need for a complicated strategy, keep it simple is my best advice for you when it comes to choosing a trading strategy. Soon enough you’ll find out that the strategy and the whole technical analysis side is the simple part.
Be sure to have a good daily routine as well. It’s so important to have a routine, that’s why I wrote an article about The Day-Trader’s Daily Routine.
How much effort should I put on Risk and Money Management?
Now, that, my friend is your best question so far. My answer is, put 200% focus, effort and time, till you get sick of it. I wish someone told me that, as early as possible when I started my Forex trading career. So many new traders skip this part in the early stages. They are so busy testing technical analysis, new indicators or new trading strategies. Neglecting Risk and Money management is the number one reason why more than 95% of retail traders loses their account in their first 90 trading days.
So again, Do Not skip this part of the course and do more research than what you’ll read over Babypips. You need to have strict rules for Risk and Money Management from the start, even when you start demo trading.
So what about Trading Psychology and Mindset?
Wow, are you for real? Man, to me, you seem to be the next George Soros. Now, we talking. If Risk and Money Management is the Queen, then Trading Psychology and Mindset is the King. You can trade the most winning strategy ever, like an 80% winning rate on paper, and still mess it up. The main reason for that is Trading Psychology and Mindset. The market will tare you down, confuse you and humble you. As soon as your money is on the line, you’ll start making bad decisions, you’ll get emotional when the market is moving against you. Doubts in your mind will make you take bad trades, move stoop-loss, widen profit level. You probably thinking, is this guy trying to help me out or scare me away from Forex Trading? I am trying to help ou buddy, but again you need to hear the truth to be ready for what to come, as simple as that.
So, be sure to work on your discipline and psychology from day one. It won’t be easy, you need to be strong and keep working on yourself. Find someone you trust to share your issues with and talk to. Trading is a very lonely business, so it’s important to have at least one person to talk to. If he or she is a trader as well that is even better.
BabyPips will not help you with that issue, but there are good books written about the topic. Trading In The Zone by Mark Douglas is a great book that you need to read to help you out on Trading Psychology. Read it at least twice, I am still reading it from time to time.
Oh, you still here?! Great news! Since you still reading and hopefully by now, you spent at least three to six months learning about Forex Trading. You tested different strategies, you did some backtesting and hopefully, you also found a simple strategy that works for you.
Now is the time to stop doing demo-trading. Oh, what? Hey, wait! I am not good at trading yet! I know, I know! But you need to ditch demo-trading and start trading at least a cent account. Demo-trading will never show you who you are as a trader. You must have some money on the table to feel the heat, to have fear and greed playing games with your mindset. Demo-Trading is solely for you to learn how to use your trading platform. Never use your demo-trading results as a benchmark on how good you’ll be when trading a live account. It’s as playing poker game with free chips, people go all-in all the time, while when playing for real money, you’ll fold 90% of the hands you get.
Trading live account you’ll find out many new things about your psychology that you never know about. But be sure to not start trading real money until you have a very good understanding of Risk and Money-management.
So, this whole mentoring thing is not needed?
Now is the time to start thinking about that. By now, you can the basics, you know how to use your trading platform, you have a good idea what type of strategy you need. Many traders that are at this point, start looking for more advanced trading skills and look for a mentor to teach them the more advanced trading methods. Others need a mentor to help them put things together, working with them to build a tailored strategy for their needs. But some keep working on their own, there’s nothing wrong with that, but it could save you much time and effort to find a good mentor to work with.
In the PA-FX Chat and Trading Room, I have many traders that did learn Forex trading on their own, they never took my course. They choose to join the room to have like-minded people to talk to and work with. Many of them are doing a great job and consistently profitable. I never helped them one on one or something like that. But what they all mostly say, that being in the room gave them a lot more confidence and learned a lot of new tricks.
So it is possible to be profitable without a mentor, it will take more time and effort for sure. It’s not a must though, it all depends on your needs.
Conclusion on learning Forex trading
- Be specific when searching the web.
- Stick to the course over BabyPips.
- Be careful of the social media and the web jungle.
- Keep it simple.
- Do not neglect Risk and Money-management.
- Trading Psychology and Mindset is the most important aspect when it comes to being a successful trader.
- Demo-Trading results are not to be used as a benchmark for live account trading.
- Do not pay money for any course during your first six to twelve months of learning Forex trading.
- Having a mentor is a good idea and will save you time and money, but is not a must.