Key Facts You Need to Know to Learn Trading Forex
Learning How to Trade Forex by thinking like a Forex Trader in Seven Steps.
Understand your place in the Forex Market
This is very important you must understand that you are very small fish in a big ocean when learning how to trade Forex.
In the Foreign Exchange Market the majority of the liquidity is coming from big banks and experienced institutional traders. These are the big fish. The big fish will happily enjoy you as a little snack.
You are only fooling yourself if you think it will be easy to take money off these big Forex traders. You have to catch the same currents they do by learning to swim alongside these big fish. Swimming against them just marks you as prey and sooner or later you will be eaten.
Learn to read the Forex Charts and Understand the Foreign Exchange Market
It is believed by many novices Forex traders believe that these big Forex traders have access to some secret Forex trading strategy or use a secret set of indicators, while the truth is this is just not the case.
Simple, but proven technical analysis techniques are being used by these major Forex players - most commonly horizontal support/resistance, identification of trading ranges, Fibonacci these are then coupled with fundamental themes.
When you decide to learn how to trade Forex, begin by accepting that the other major participants are highly experienced in the market and they make money because of experience and by a complete understanding of the core skills and not because they hold a holy grail of secret indicators.
Money Management
It is crucial that you understand the emphasis as a novice Forex trader is on how you manage what you have not on how much you can make from Forex trading.
While going to learn how to trade FX you must know that this style of trading is not sustainable and professional traders do not trade in this manner. Everyone sometime in their career will have a string of bad trades. A typical number might be 10 losing trades in a row. The question is do you have a money management plan in place that enables you to survive this?