10 Tips for Beginning Forex Traders

Any novice trader knows about the need to undergo training and constantly improve their skills, deepen knowledge about the world of finance. Therefore, we consider 10 practical recommendations that will bring real benefit to each beginner.

1. Get a demo account

A demo account allows you to get acquainted with the financial market and trading terminals, check the strategy and, for example, an adviser, without any risk. It is impossible to make money with it, however, it will not work to lose money either

2. Do not trade against market movement

The market always has a priority. Before opening a deal, you must clearly understand which direction the market is currently heading. The recommendation is extremely important for beginners – give up trading against the dominant trend.

3. Use Stop Loss

At the first stages of trading, you should use Stop Loss (order to stop drawdowns) constantly. Otherwise, you may not have time to respond to market changes. The risk of withdrawing a certain amount will remain, but to lose the entire deposit – no.

4. Find your strategy

Do not try to develop a strategy yourself. To create it, you need to understand what factors influence the entry and exit points, lot size, etc. Use proven options by testing them on a demo account.

We must say right away that there is no ideal strategy that always correctly indicates where to place an order for profit. If you are offered to buy it and promised 100% earnings, know in advance that this is a hoax.

5. Choose one asset

You should not try to work with all financial instruments at the same time. Find an asset with insignificant volatility. Find out in advance his statistics, history, etc. Analyze changes in the value of the release of some important financial news.

Instruments with a low degree of volatility are not the most profitable. However, they are less risky. And in the first stages of trading, it is important for you to minimize risks.

We recommend giving preference to technical currency pairs, abandoning cross-rates.

6. Reduce losses and increase revenue

It often happens that novice traders with a minimum profit immediately exit the transaction. At the same time, they should see a minus, and the expectation of price growth in the necessary direction begins.

Control your emotions and learn to wait for profits, and not inactive to monitor losses.

7. Be careful with leverage

Some newcomers mistakenly believe that the greater the leverage, the more profitable will be their work with the broker offering it. In fact, there is a great danger lurking in huge shoulders, especially in Forex, when the indicator can reach 1: 2000.

In the vast majority of cases, when opening a position with such a volume, the merchant automatically deprives himself of the deposit. It is enough for the market to make several ticks not in its direction.

Shoulderless trading, for example, on the stock exchange, is associated with significantly lower risks. Even unsuccessful “workers” here usually merge their capital in at least six months to a year. On Forex, with its impressive shoulders, this can be done in 30 minutes.

8. Don’t quit your job for the sake of trading on financial exchanges

The recommendation is not only related to the fact that you can not make money in the market. But also with the fact that without a stable source of profit, controlling emotions is much more difficult. Even if before dismissal it seems to you that you are a calm professional in trading, and you have a certain stock of financial resources outside the exchange.

9. Do not give up technical analysis

Before starting a real trade, you should clearly understand what levels are and what patterns mean. Analyze their work on history.

10. Consider universal tips for opening and closing deals

Finally, we give some general recommendations that traders with any experience in the markets take into account:

  • Transactions with an income of 20-30 points should be closed manually. At least in the first stages. Otherwise, there is a danger of making a mistake with the size of the stop, take, entry point;
  • Before announcing important political or, for example, economic news, it is worth leaving a profit order or transferring a transaction at a loss-free basis;
  • Exit the transaction immediately, not expecting profit, if the order has been in drawdown for a long time, and then went to zero. We have already said that with a high probability there will be no income. Because the input was mistakenly initially.

In conclusion, I would like to advise you to take the trading process seriously. Do not look for “magic” strategies and do not focus only on the recommendations of “professionals”.