Nowadays anyone with money and little time can get into foreign exchange trading. However, a Forex trader needs skill and patience to be successful. A profitable trader limits their losses while identifying good trade setups with positive risks. Retails traders who are just starting out in the Forex market are often unprepared for what’s to come. So they need to take specific steps to avoid disappointments and losses.
Let's begin by examining steps to be a Forex trader:
Doing research – Before getting started, one should do proper research to understand foreign exchange trading. Since Forex market is technically driven, a new trader should read books on technical analysis. Every trade should be justified through research. Once they have a solid foundation, traders must learn about fundamental and technical developments in the Forex market.
Finding a good broker – A Forex trader needs an excellent broker to ensure that the money invested will be safe. Also, a broker provides a stable trading platform to conduct trading when the market is active.
Practicing on a demo account – On finding a proper broker, the trader should test the platform by opening a demo account. These accounts have same functionalities as live accounts and trades can be placed in real time to represent actual losses and gains if the money were real.
Capital for trading – Foreign exchange trading does not require a lot of money because of being able to trade on margin. A trader needs at least $100 to open an account and a minimum of $1000 to open a mini account. This will allow a bit of a buffer in case of losses.
Tips for Success
Don’t Stall – Those who have attained success will never staff for time. They always make every opportunity count. This behavior is all the more relevant when trading in the Forex market. Traders must seize every opportunity to achieve trading targets.
Practice before live trading – As the saying goes “Practice makes perfect,” beginners should practice to their heart’s content before they start with live trading. This will help one to get familiar with the trading platform and its features.
Stay up to date with market – Whether a novice or a seasoned foreign exchange trader, the process of learning should never stop. The only way to succeed is to stay up to date with current trends and technical developments in the Forex market. Beginners can find webinars, books, and tutorials on Forex trading in websites like LiteForex.
Develop trading strategy – To be a Forex trader, a clear vision is the need of the hour. That means understanding how the market moves and taking relevant actions. There are some trading strategies available; however, to find one which works stably one needs to practice it in demo accounts and also back test properly. Time and patience are also essential requirements which one needs to have for attaining success in the long run.
The path to becoming a Forex trader is not an easy one. However with time, effort and passion, anyone can find success in Forex trading. So, visit a broking website and take a step towards economic freedom.
The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteForex. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC.