How to Learn to Trade Forex for a Living

Last updated on July 23, 2020

Learn to Trade Forex

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Forex is a financial over-the-counter market where currency exchange takes place. The Forex market provides an opportunity to significantly increase savings.

However, it’s important to have an understanding of the markets and trading.

Forex market is open and accessible to everyone. Low entry threshold attracts traders who are guided by the goal of receiving both additional and basic income.

If you feel that Forex trading is a potential opportunity to make money, let’s consider ways how to start trading.

Get a Forex Education

Without training, there can be no successful trading. You can master the basics of trading for free.

There is a lot of websites and resources related to Forex trading. Spend some time reading up on what Forex is about on such websites as Investopedia and Babypips.

Develop a Trading Plan

The trading plan helps to make balanced decisions. It should meet your requirements and contain the following points:

  • Currency pairs which you plan to trade;
  • Timeframes – time intervals in which you will trade;
  • Signals for opening and closing a trading position;
  • Risk management (stop loss and take profit levels, risk/profit ratio, allowable loss).

With a properly drawn up plan, your emotions will not be able to control you, therefore, you will not make rash decisions on the spur of the moment and minimize losses.

Use a Demo Account

Start with a demo account – a Forex trading simulator.

Such accounts do not require investment, which allows gaining experience without any risks.

Demo trading is very similar to the real one: you work on the broker’s trading terms, get the same quotes, make transactions, master the platform as well.

JustForex does not set limits on the use of a demo account.

You can practice as long as you need. However, in case you have not logged into your demo account for more than 90 days, it will be deleted automatically.

Start Trading

Once you have succeeded in a demo account, and your profit is growing steadily, you can open a real account and start trading real money.

There are various types of accounts on Forex. Trading accounts may vary by the execution method, initial deposit, spreads, leverage.

Some brokers offer their clients cent accounts. These are exactly the same accounts, but the balance is displayed in cents. Such accounts are ideal for an inexperienced beginner.

But do not forget that real accounts involve even more self-control and discipline.

So that excessive emotions do not interfere with making the right decisions and do not hinder trade, the trader should clearly and accurately follow the rules of the trading system.

Learn About The Currencies You Trade

Each currency pair has its own characteristics that should be considered when trading.

Currency pairs with low volatility, which are less risky for the trader, are a good option to start trading. Beginners can improve their basic knowledge and skills of trading.

Among such pairs are EUR/CHF, GBP/CHF, EUR/GBP, USD/CHF. They are traded relatively calmly.

However, new traders should be more attentive or avoid trading on GBP/JPY, GBP/USD, EUR/JPY currency pairs, as they have sharp movement dynamics within a day and are rather unpredictable.

Understanding Of Trading Psychology

Forex trading psychology is of importance. Every trader experiences different emotions: fear, excitement, greed, anger.

Giving in to such emotions as greed, fear, traders often open rash transactions, missing important news. It is important to be able to control and turn off these emotions while trading.

Plan Your Trading Week

Professional traders recommend checking the economic calendar before every trading week to be aware of news scheduled.

Before the beginning of the trading week, look through the economic calendar and choose events that will be important in trading.

Eventually, if you are willing to dedicate the time and efforts into becoming a successful trader, forex is likely to become a good solution.

As with any profession, forex trading is no different either. It will take time and, in many cases, it will take years before you can perfect the art of forex trading.

Final Note

However, all said and done, remember the fact that forex trading is risky. You will always be at risk of losing your money regardless of how good you are.

Taking losses is part of forex trading. The trick is in ensuring that you lose less and win more.

This has been a guest post by Vlad of JustForex.

 

About the author

Virginia Nakitari is a work from home mom passionate about making money online. She's here to show you legitimate companies offering full-time, part-time and remote jobs from home! Stay tuned!

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