Post by traderAllen on Aug 10, 2014 10:09:20 GMT -5
Let's assume for a minute that you find yourself with a little extra cash and decide you want to start trading Forex or forex futures . You could start by going to the web searching “Forex trading” where you'll find a wide variety of information some of the good most of it crap. Or you could try reading a book there are hundreds of them most of which I read, and there again you have the same problem there is some good information but most of his crap. Maybe decide to join trading room where you'll soon find just like the webs and books most are just rehash. So maybe you'll just download MT4 and by a robot to do the trading for you. Soon your account will be wiped out because all robots free or being sold on the web are worthless.
So how does our 'want a be” Forex trader learn how to trade profitably? You could learn basic information about trading from some websites for free. That's better information than most books. You could buy some of the myriad of books on indicator-based trading however keep in mind you'll be getting into the trades way too late to make any profit. Same with pattern-based trading. Elliott wave, forget it, its far too complex and subjective to really be of any use. So back to our question. How does our new Forex trader learn how to be profitable? First open an account with a good Forex broker. That's the first problem as most are scams and trade against you and their software is set (skewed) in their favor. This make it virtually impossible for you to make a profit. However once you find that broker where you can get good fills, screen time is the only way to learn. Pick one currency probably the Eurodollar for most and spend as much time as possible watching and learning the movements. Currencies are no different from stocks or futures they are people making trading decisions you need to watch the screen until you become familiar with the trading that is moving the market. Learn where the buyers will be and where the sellers will be, then jumping in ahead of the buyers or short ahead of the sellers. If you have a level II screen that's a plus learn to watch the order flow notice how when prices hit a certain level order flow picks up and prices reverse. For example. Watch for prices to pullback to a fib level don't just jump in at that level watch the order flow and see if the fibers are there. If they are and you will see them jump in and ride the wave up and get out where you know they're going to exit because you watch them many times. Or you may be watching for the big players where you'll notice when price reaches a certain level order flow kicks in and the price reverses usually but not always around round numbers, there's no magic it just easier for most people to think in round numbers. These two examples are more of scalping methods but the work the same on the daily chart. So my advice is to our new traders watch and learn watch and learn study the chart, think “where are the buyers where are the sellers” that's what you need to know.
Of course that's just the tip of the Forex iceberg. Learning proper money management and how to manage a trade is a whole other article.
So how does our 'want a be” Forex trader learn how to trade profitably? You could learn basic information about trading from some websites for free. That's better information than most books. You could buy some of the myriad of books on indicator-based trading however keep in mind you'll be getting into the trades way too late to make any profit. Same with pattern-based trading. Elliott wave, forget it, its far too complex and subjective to really be of any use. So back to our question. How does our new Forex trader learn how to be profitable? First open an account with a good Forex broker. That's the first problem as most are scams and trade against you and their software is set (skewed) in their favor. This make it virtually impossible for you to make a profit. However once you find that broker where you can get good fills, screen time is the only way to learn. Pick one currency probably the Eurodollar for most and spend as much time as possible watching and learning the movements. Currencies are no different from stocks or futures they are people making trading decisions you need to watch the screen until you become familiar with the trading that is moving the market. Learn where the buyers will be and where the sellers will be, then jumping in ahead of the buyers or short ahead of the sellers. If you have a level II screen that's a plus learn to watch the order flow notice how when prices hit a certain level order flow picks up and prices reverse. For example. Watch for prices to pullback to a fib level don't just jump in at that level watch the order flow and see if the fibers are there. If they are and you will see them jump in and ride the wave up and get out where you know they're going to exit because you watch them many times. Or you may be watching for the big players where you'll notice when price reaches a certain level order flow kicks in and the price reverses usually but not always around round numbers, there's no magic it just easier for most people to think in round numbers. These two examples are more of scalping methods but the work the same on the daily chart. So my advice is to our new traders watch and learn watch and learn study the chart, think “where are the buyers where are the sellers” that's what you need to know.
Of course that's just the tip of the Forex iceberg. Learning proper money management and how to manage a trade is a whole other article.
