There are no official universities or schools for
Forex trading. Aspiring traders must do it themselves and embark on a self-taught journey. Of course, webinars, online courses, video tutorials, and ebooks help, but they are forced to independently organize their own study plan. Therefore, rather than the content in the literal sense of the term, what is important and decisive for good training is the knowledge of some fundamental principles and the consequent acquisition of a mindset. Principles and mentality that can be summarized or organized into
four tips. Here they are.
The most important discovery
There is a preparatory action for those who want to embark on a Forex Trader career: the assimilation of a cardinal principle, from which all others derive.
There is no best strategy; there is the strategy most suited to one's personality. This must be understood from the beginning, so as not to fall into the most classic of pitfalls: listening to those who want to sell the most effective recipe for earning in Forex. Even if it was actually a strategy that has produced a lot of profits, it would not fit everyone. To claim otherwise is false, presumptuous, and very dangerous.
The corollary of this principle is that it is not advisable to search for the best approach if you do not first have full knowledge of yourself and your
own personality (at the trading level). Here are some questions that should be asked to fully understand one's nature.
- Am I comfortable with nervous markets?
- Do I prefer to execute a few orders per month or many?
- Do I feel more at ease if I focus on one pair, or do I like to vary?
- Am I comfortable with indicators?
The ability to withstand stress, preference for slow or fast trading, range of action, and mastery of indicators are just some of the elements that need to be considered, and all together they contribute to composing the personality, or style, of a trader.
Starting from demos
The general vulgate suggests using demo accounts at the end of one's training path. Certainly, it is good that theory comes before practice, since only theory can provide that minimum background to avoid being disoriented when placing a trade. Many, however, study for months without ever having approached demos. This is intrinsically wrong because, while it is true that theory precedes practice, at a certain point - presumably soon - they
must go hand in hand.
Aspiring traders have the opportunity to trade with demos, without any cost or risk. So... Why not do it? Why wait so long? The use of demo accounts, in fact, facilitates the understanding and assimilation of notions, giving the latter a greater body, a vivid reminder of reality.
Today, the vast majority of reputable brokers
offer a demo account to their users. This invitation to trade, to get hands-on experience, should be accepted by all beginners. Also because the advantages are numerous.
- There is no risk to one's capital.
- Opening a demo account is free and quick, taking just a few minutes.
- Demo accounts are identical to real accounts.
- The offering of charts and indicators is the same.
- It is the only tool to actually learn to employ a fundamental technique for one's survival: the stop loss.
- It allows you to understand a strategy in its entirety: mechanisms, risks, opportunities, etc.
The only limitation of the demo account, which however does not derive from its lack but from its simulative nature, is the inability to convey the pathos, the
stress and that set of emotions typical of any trading activity. If there is no risk of losing one's capital, there is also no psychological pressure. The only way to learn to manage one's emotions, unfortunately, is to trade in the real market, with a traditional account.
The importance of the diary
Keeping track of one's trades is of fundamental importance. Whenever a trade is placed, even if only through a demo, the beginner should accurately report the coordinates, capital invested, entry, exit, and results. The reason is simple: improvement is a matter of mistakes. The more you make, if you are a beginner, the better, but only if they lead to a real understanding of what you should or should not do. So, to
learn from your mistakes, it is good to recognize and memorize them, and it is possible to do so if and only if you keep your diary always updated.
It is not said that you necessarily have to go heavy with paper and pen. There are less tiring methods to preserve your "memoirs". Some sites, in fact, have intercepted this need and propose some tools for personal reporting. An example?
MyFxBook, a platform that automatically stores trades, produces all the data about them, and organizes them in a simple and accessible interface.
You never stop learning
A belief that all traders should have is that
you never stop learning. Forex trading, as well as trading in general, is a constantly changing field, enriched by the birth of new strategies and approaches. Of course, at least according to what technical analysis suggests, the market repeats itself cyclically, but this does not exclude the emergence of new developments. Indeed, Forex trading is, among all markets, the most varied. It is obvious, therefore, how training should not be understood as something static, self-conclusive. It has a beginning but no end. Successful traders never stop updating themselves but, on the contrary, always try to discover new approaches and new strategies. They do not fossilize in the field of their skills, but rather try to go beyond.
If you follow these practical tips and respect the aforementioned principles, there is hope that an aspiring trader, even starting from scratch, can make a career in Forex trading. Those who start and give up after a short time, perhaps for having lost all their capital, regardless of personal limitations, have embarked on their path hastily, without dwelling on the possible implications and on some fundamental practices. As, precisely, that of practicing almost together with theory, of keeping track of one's trades, of not relying on those who promise miraculous recipes.
In the end, the transformation between Sunday traders and experienced (as well as rich) traders is nothing complicated. It only takes a lot of commitment, a not indifferent patience, and some good teachers. Those training programs full of theory, which do nothing but list notions, are to be avoided. A sterile exercise, this, at least at that stage of a trader's life. Much more useful, to take the plunge (with a parachute) and try to take flight.
