Foreign exchange is a double-edged sword, many people make a million dollars quickly but a lot of people step into the market with a little knowledge and experience and then bankruptcy because of it. Therefore, it is important to know the principles before trading forex to minimize the risks.
1. Be mentally prepared to “lose”
All traders have made a loss in the trading. 90% of traders fail in the first time, largely due to lack of planning and experience, lack of money management and risk control.
2. Foreign exchange is not for the unemployed
Forex trading is not for the unemployed, the low-income people or incapable of paying expenses. You must have at least $ 2500 – $ 5000 in your account (the lowest level that brokers recommend with standard accounts) that you can accept losses if you really want to join the Forex market.
3. Don’t join the Forex if you lack of discipline
The forex market is the most popular market for professionals, due to its enormous scale, and the strong volatility of market trends. Many unsuccessful players often think that they are unlucky, but because they lack the discipline to comply with the necessary principles in trading. Most people cannot keep up with the strict rules about losing weight or going to the gym every day. If you are like them, do you think you will succeed with this market?
4. Foreign exchange is not a chance game
Forex trading is neither an amateur’s game nor an easy path to success. You cannot make huge profits without accepting the same risk. A good play strategy is to anticipate risks and improve the successful performance of each transaction. A successful trader must have a strategy to play – unless you want to become a “gambler” to be rich!
5. Trading foreign exchange is not a quick method to get rich!
Good foreign exchange skills require a lot of time and effort to train. Highly skilled traders can and have high potential to get rich from this field. However, like other jobs and professions, success cannot come overnight.
6. Passion, hard work, and patience are needed virtue
Forex market is not “giant pie” as some people often praise. The truth is sometimes there are experienced traders who still encounter some bad situations that lead to losses. There is no short cut in this market, and you must prepare ahead of time, effort and even loss before becoming an expert.
The key to success, there is no substitute for passion and diligence in researching and understanding the Forex market. Practice with a virtual account before you start with a mini account and then a real account.
And do not be too impatient to open a real account before you have traded really well on the virtual account. And if you can’t wait for your virtual account to trade well for at least 2 months, and if you’re impatient, it’s best to choose another business.
7. Focus on one major currency pair
It’s complicated to research too many currency pairs when you start playing. Choose a currency pair with the least spread and high volatility (such as EUR / USD or USD / JPY) to focus on trading in the first time.
You may be successful in currency trading, but like other businesses, it requires investment in effort, passion, a little luck, judgment, and the right decisions. propriety.
Synthesized by top4forexbrokers.net