How to trade Forex by yourself?
How to start?
One can hardly think of anything new, except for self-education. The most useful, in my opinion – is reading the comments and blogs of experts, in the wake of specific news and events and market reaction to them. Reading a book is useful, but it must take place in the background, as an auxiliary material, expanding the knowledge base of the future trader. So people will always understand what is important and what is not, as the market reacts and what it leads him. At the same time on a reconnaissance in force soon will be seen, whose advice is good and who is just a master of reasoning about the past.
Even better, if your guru – himself a practicing trader who does not hesitate to talk about specific levels of opening and closing. But this is rare. As a rule, all prefer to give advice or to trade without disclosing specific strategies. But this is the last century, more openness is welcome. Including this help different signal service where it is possible to replicate real trading activity of another person.
And yet it does not free you from having to start the whole routine process to explore the trade and all the nuances before to bet real money.
Should I read the book? Books give a more fundamental knowledge, but will often be a problem using them in specific situations. In addition, it is now easy to find a particular definition of the search engines. So my first piece of advice – find a decent “teacher” (this can be blogs, analyst from companies forex brokers or investment-banks).
Next, we try to understand that professional advice on what factors (technical or fundamental) draws attention to the kind of perspective marks. If you fit his style, try to trade on a demo account in accordance with his recommendations. At this stage, you do not risk money.
What is the amount?
This advice is most often hear when investing in stocks, but in regard to high-margin forex trading its relevance is greater than ever: Define for yourself the amount you can lose without jeopardizing the financial well-being of his family. Because in fact, here you can lose everything. On the other hand, high levels of leverage let you create very impressive orders in comparison with the capital that you have. Now forex brokers leverage can be up to 1: 1000, often extended to 1: 500, and is considered a classic of 1: 100. Forex less volatile than the stock market, and so there’s shoulder is higher than can be obtained on futures (1:15) or liquid shares (1: 2).
Do not be tempted by the fact that on a demo account you can set up any sort of a large sum. When trade is an important opportunity to Drawdown account. This is where you can “sit” losses on the transaction or a series of unsuccessful transactions. Part of the situation, when the trader receives a margin-count, and then the market turns in his direction. With a large depot in the demo, and little in the real world, you stay in the game in the first case and get the margin in the second number that is most offensive, agree.
If we talk about real figures, then for a standard forex (I’m not talking about mikroforekse where lots 10 times less), it should be no less than one thousand dollars (at least not less than one), but the trade must be carried out either very short term or the minimum volume as forex – this high-margin market, which can be a big drawdown.
How to choose a broker?
First of all, choose the reliability and validity. After all, the company will store your money and fulfill your requests. Previously, the company provides access to the forex dealers were in fact, not the brokers for their clients. That is held by the other party and were playing against their own customers. Basically, it even came to small companies, large this is not sin, due to the requirements of the regulation.
This business model still exists, but is gradually receding into the past with the development of the industry and its formation. It was called the market-making model. Agency as a model is a more viable option for customers who do not want to carry money in the “kitchen”. According to the agency model, the company receives quotes from the world’s leading prime brokers and redirects them to its customers. Those, in turn collected quotes and application of the plurality of banks.
It turns out that the task of forex broker is to provide the trader friendly trading platform and the choice of a suitable prime broker. And, of course, the collection of modest, but not extortionate fees.
Now in Russia more and more opportunities to open an account in a foreign company, regulated jurisdictions rather strict EU or UK, where it is very strictly monitored to provide customers with the best bid and ask quotes, and considered the issue of protecting the interests of the client and its capital. How do you know how reliable the company?
Look at where it is incorporated and in which jurisdiction is authorized to work. The UK FSA is very picky about the license. In remote corners of our planet this is easier.
Can I learn the most?
Of course, no self anywhere. And I advise you to begin with a self-study. Only in this way can be understood that tells you that a lecturer on paid courses or clever book. Roughly speaking, you arbitrarily many times can talk about what you need to buy low and sell high, but you must create for themselves an understanding of how you define where “cheap” and “expensive”.
And then, when you will be known terminology and function, you can most effectively listen to others, to try their ideas and approaches. The main thing is do not let them mislead their brains. You should always understand how a one time or another signal.
And even more than that, you have to think of themselves in this direction, and a particular signal, which says this or that person or the strategy should only strengthen your confidence in the correctness of the chosen strategy.
How not to lose?
Be careful and trust only themselves. Generally speaking, no damages can not do so as much as possible try to keep this loss was virtual rather than real. Take a chance with real money, only having caught a few months of experience of active trading on a demo account.
If you look at the market from time to time, it is best not to take up the live trade, they have had a positive experience of trade less than a year. Besides reading other people’s reviews and advice you need to grow your own observations. That they are impartial, keep a diary of the trader.
As a result, you have to come for yourself to determine their own trading style and the basic parameters of transactions. Since no one, even the most successful trader will not be able to make recommendations exclusively for you. Keep enough money in the account to avoid margin cola. Be open to new ideas and are constantly looking for trading them. And here’s another tip – do not change the stop loss towards greater loss.
Let this be the initial level adjusted with the help of your trading system. So you risk to lose the battle, but the war and continue to take revenge later.
What are the tools of the trade to choose?
You should rely on your own trading style. Oil demand from you in addition to observing the fluctuations of supply and demand to become an expert in geopolitics. Many people like the euro / dollar, because it is the most popular pair, and all the newswires are filled with information from the eurozone and the United States.
I, for example, the couple seems suited to the fundamental long-term analysis, it is run on a shorter time intervals of Technology (15-minute), but completely useless for predicting the medium term. On it are very frequent false breakouts previous extremes. I like how fulfills the usual standard on the four-hour RSI candlelight in USD / JPY (and this position trading with one or two trades per week), but the euro / dollar the same rules difficult to apply.
It is difficult to apply them to cases of high volatility caused by external factors, whether the intervention (both verbal and physical) or crisis, companies, sectors of the financial system. Decide what type of a trader you think about and look for your instrument.
Also pay attention to the volatility. There movable pair, GBP / JPY, AUD / JPY, AUD / USD, and there is almost “dead”, as the euro / franc most of the time. And if such dohlyaki come to life, then all will not find it. There are crosses, usually a single currency in the region, which fluctuate within the range of the long-term. These I attribute EUR / GBP, AUD / NZD, and crosses many European currencies with the euro.
Take the trouble to make their observations, even if they differ from the findings of colleagues and friends.