Forex Lessons in Summary

There are many lessons and tips to learn about trading the Forex. These 40 Forex trading tips and lessons are a result of what I've learned about trading, as a beginner, and from the use of a Forex demo account. So, if you are a beginner level trader, or thinking about becoming one, this list of 40 trading tips and lessons is especially for you! The list is not in any particular order of importance, and later I'll provide additional reading for many of these points.

1.    Appropriately select the right Forex trading platform, and preferably a Forex broker without a dealing desk.
2.    Select the Forex market indicator tools that work best for you, and watch their market signals.
3.    Realize that leading or lagging market indicator tools are not perfect, but still valuable.
4.    Learn to trust the market indicator tools more than your market fear, anxiety, or greed.
5.    Don't be anxious to enter a market until you have fully determined the proper entry point and direction.
6.    Don't allow your anxiety or greed to cause you to be anxious before you determine an appropriate exit.
7.    Admit when you're wrong and get out of a trade that goes awry before it gets out of hand.
8.    Test, and retest your knowledge and strategies with a demo Forex account before going live!
9.    Once you go live, test new strategies with your demo account, not with your real money!
10.  Strategies for scalping, intraday trading, or swing trading, must match your budget to avoid margin calls.
11.  Don't allow a winning streak to cause you to overlook your true percentage of winning vs losing trades.
12.  If you don't know how to trade, don't buy a Forex automated robotic software to do the job for you.
13.  Become proficient at proper entry and exits within a Forex demo account, before opening a live account.
14.  If you take a wrong position it's best to exit promptly and suffer small losses, rather than hoping for a market retraction, which could eliminate a large sum or all of your equity before the retraction occurs!
15.  Start small with the number of lots you trade, but think big since the Forex can result in exponential earnings, or losses.
16.  Lack of initial capital can make it difficult for swing trading in order to avoid margin calls, so plan on having a good sum of initial funds to open your account, so you're not undercapitalized.
17.  Your attitude about the Forex must be the same as a business mentality - you will experience both profits and losses.
18.  Study each time chart prior to entering a trade to confirm the direction and trend of the currency pair you've selected.
19.  Become proficient at trading one or several currency pairs rather than jumping around with a variety of pairs.
20.  The best time to trade is early mornings when the market has the most activity.
21.  If you trade in the afternoons, realize the market moves slower and may result in impatience.
22.  If your trades are not closed out the same day you entered, prepare for potential overnight losses.
23.  Take the time to evaluate the proper price to set your stop losses, take profits, trailing stops etc.
24.  Don't beat yourself up when you lose a trade, but rather re-evaluate why it happened and learn from it.
25.  Don't enter the Forex market with a "get rich quick" attitude, which could cause you to become too anxious to make money and result in making incorrect trade decisions.
26.  Don't allow anxious feelings to cause you to enter into a trade too early.
27.  Use your Forex demo account when you're unsure about your strategy so you only lose play money, not real money if you're wrong.
28.  A Forex demo account is the best place to learn from your mistakes so the price you pay for your mistakes is only lost time, and not money.
29.  A Forex demo account provides you with the ability to learn from indicator tools and your strategies, right or wrong.
30.  An important purpose of using a Forex demo account is to learn how to train and control your trading emotions, so you don't allow your emotions to control your trading, which will generally result in losses.
31.  One of the most difficult Forex trading lessons to master is learning to control your trading emotions.
32.  Trading the Forex naked (without indicator tools), using price action and pattern recognition helps to eliminate emotional trading decisions, and to increase profits.
33.  Trading the Forex based on price action saves you time, and helps to eliminate market anxiety.
34.  Always be mindful of proper money management while trading. Don't allow market greed to push you to trade too many units, or too large of a percentage of your equity at any time.
35.  Quit when you're ahead and take a break, it's not possible to win every trade.
36.  Realize that indicator tools will not teach you how to trade, but rather will be like a crutch.
37.  Learn to trade without indicator tools and learn to recognize candle patterns and market reversals.
38.  Don't be anxious to open a live account until you have proven your ability to be profitable by practicing with a Forex demo account, which works like a trading simulator.
39.  Watch to make sure your trading emotions such as anger don't take over and cause you to become self-destructive with your trading.
40.  Realize that your success with trading the Forex will depend a great deal on whether or not you can master your trading emotions, positive or negative.

Happy trading! This completes my list of Forex lessons and tips in summary, and I hope you found it to be helpful. If so, please leave a comment! Thank you!

No comments: