Forex Guide: Things That Every Beginner Traders Should Know Before They Start Trading in Forex

It’s a fact that forex trading became a highly preferable investment method in the last decade. Combined with the internet as a global 24/7 network forex is reachable to everyone. I’ll not give you about the basic explanation of forex trading in this article. I’m sure that i don’t have to tell what forex trading is. People which familiar or have an interest in an investment know forex already. Don’t they?

Forex trading is basically just an investment

As any other investment, there are always benefits and risks beyond forex trading. Many people/organization, especially forex brokers, its affiliate and those who earn their income by providing some forex related services says that forex trading have so much advantages compared to other investments; Forex is easy, with its non-stop 24 hours market, its wide range adjustable leverage, its automated trading platform, its offered better opportunity for income resource, and many more — you name it as much as you want to…

Blinded by its ‘beautiful dream imagination’, many small/personal traders, especially for the new ones forgot that forex trading is basically still an investment program. Traders should never have a thought that forex trading is an income resource.

Common Beginner Traders Scenario

Beginner forex traders are usually follow the trend of forex trading without preparing and providing them self with an adequate understanding about what’s inside forex trading. Their common scenarios are:

1. Know about forex trading

2. Have an interest in forex trading

3. Looking for an easy and profitable forex services

(Usually by looking for some services with less margin, high leverage, automated trading platform, and less risk? – which is too good to be true)

4. Start gambling with their trades

5. Unable to achieve profits as what their imagination

6. Repeating scenarios 3, 4 and 5

7. Repeating scenarios 3, 4 and 5 again… and again…

8. Realizing that they are losing too much or that their imagination along these days/weeks/months is wrong (i doubt that it would reach years)

9. Give up and quit their trading for good.

Where did they do wrong in above scenario? Is that wrong to always searching for a better service to back up our trade? In my point of view, there are no mistakes in that scenario at all. But it’s just incomplete, and that’s the most dangerous mistakes made by most beginner traders.

How to Overcome Traders Mistakes and Begin to Make Some Profits in Forex

The facts are, there are just 5% of forex traders which successes with their trading. To become as they are, we should insert step 2.5 in scenario above. This step will simplify above scenarios by eliminating the fourth and eighth and changing ninth step became TRADERS GOAL ACHIEVED.

2.5 Preparing yourself with a solid basic knowledge of forex trading

– Know about the fundamental of forex trading

– Learn about what and how forex market really is

– Train yourself to getting familiar with the technical analysis in forex trading

– Learn how psychological factor affecting in the trading and define our best trading personality

– Be aware in our risk and money management

– Develop your most effective unique trading system based on your knowledge.

We should keep in mind deeply that forex trading is an investment. There is no way that we could be a master in some investment that we’ve just dive in to for days or weeks. We have to do it by the right way, and don’t forget to eliminate your rush in the goal achievement. You will surely find your best trading system that suits you, I guarantee that. But it would cost you some time for several trial and error system testing while you developing your experience in forex trading.

By using an analogical approach as a computer, forex broker is the application programs and operating system. We do need them to make sure that all we need its done, served and executed properly. But, how good the computerization execution speed and its performance are depends on the basic computer specification, which analogically as you.

How to Get Yourself Completely Forex Prepared

Learning and education materials are world widely spreading around us.

1. The first and the most value added a resource of forex trading is through book reading. Forex and investing categorized books are available in countless numbers in many bookstore and online bookstore. You should pick some of them to educate yourself with valuable knowledge of the theory beyond forex trading.

2. Try to get into some traders forum to know more about forex trading and the markets. Forex forum also a place to give you an information for forecasting the crowd psychological factor to forecast the currency price movement by examining on how do other traders react in some financial forex related world events.

3. Get a forex course. An expert forex traders or forex broker are offering this kind of forex educational method. The course are usually about the basic knowledge of forex, technical analysis technique usage and its tools, an expert trading advice or maybe in how to develop a particular tested forex trading system which profitable (if done right and backed by your forex basic knowledge).

4. Forex magazine subscription. Some forex magazines are published weekly, monthly and others might be yearly. These materials usually give you information about the updated forex market behavior overview and analysis which can be use for the input of the fundamental analysis of your forex trading.

Make Money in Forex Trading – Pro and Cons

Is someone telling you that you need to learn how to make money in Forex trading now? You probably want to find out what is Forex and how to make money with it. Forex stand for “foreign currency exchange” which is a business of exchanging certain currency to another currency by simultaneously buying one and selling another. Before you make your first decision to go into this market, let’s find out what are the benefits and disadvantages of trading Forex.

Rewards of making money in Forex trading:-

More Free time – You can have more time with you family. You can be your own boss and no need to trap in the traffic jam with those working 9 to 5.

Trade anywhere,anytime – There is a lot of flexibility with trading Forex, as long as you have a laptop and broadband with you, you can trade Forex wherever you are.( except Saturday and Sunday because market close.)

Automated Trading System – Yes, you can trade Forex and make money 100% automatic with some automated trading software. So you can have a good sleep and no need to worry that you may miss the profitable rate .

Disadvantages of making money in Forex trading:-

You may also lose money – The market is changing like weather, so you need to be good in analysis the market in order to reduce the risk.

Lots of  study – Be frank to you that a good trader spend lots of time to study the information of politics, business ventures, and technologies. Because these are the issues which will affect the market. If you are lazy to study, Forex trading may not your cup of tea.

Lack of competitive spirit – A major disadvantage of trading is lack of human interaction. You may lost connection with your peers in real life to keep the competitive spirit alive.

Nevertheless, many people are making full time income by trading Forex. I am here not to discourage you.You need to know yourself well and do some research before going into the market. Do not follow blindly and become the next victim in the market. But if you are willing to work hard, you will make lots of money with Forex trading.

Is Anybody Making Money Through Forex Trading?

Forex (Foreign Exchange Market) trading is a market place where currencies are traded. It is been in place since 1970. Money making through Forex trading has caught up the attention of many people who surf the Internet. Currency trading could be done 24 hours a day across the globe. Investments in these markets are done through dealers or having a personal forex trading account. Speculation on currencies has been a common practice in the Forex market.

If anybody wants to learn how to make money through forex trading one must understand the term Marginal trading. This is done for trading forex with borrowed money. This makes it very appealing because anybody can make forex investments without the real money supply. It means that we can make bigger investments in the forex market with fewer money transfer costs.

The understanding of fundamental strategies of technical and financial analysis is very important in forex trading. The technical analysis provides you with the currency fluctuation and factors in the various movements of currency prices in the market place. The fundamental analysis provides with the economic data of the country in whose currency you wish to trade. The political and other trade related rumors quantify the trend in the currency value.

Forex trading is always rewarding if done with right strategy and knowledge. The risk is certainly great, the ability in margin trading with little initial capital investment means potential profits. The forex market investment gives equal opportunity to all investors to make profit on their investment. The well-informed people who make the necessary technical and financial analysis on the currency movements make definite profits with very little investment.