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Is It Wise To Trade Forex As A Newbie?

Trade Forex

It’s pretty easy for a newbie to learn how to trade forex. The critical question, of course, is, “How well?” Serious beginners get on the internet and start reading like crazy. They know that they need to learn more about central bank operations, including monetary policy changes. They’re aware that commercial banks are supporting the forex industry but they aren’t sure how. So, they check out the websites of entities like Barclays, HSBS, Westpac and ANZ and discover a mother lode of forex-related information. They also visit news sites like Reuters, Bloomberg, NHK (the BBC of Japan) and Xinhua (the BBC wannabe of China) to fill in the gaps of their knowledge of the world. Finally, if they have never bumped into technical analysis before, they go to “Chart School” at “stockcharts.com” and receive the education of a lifetime.
When you think you have had enough of words, sign up for a “demo account” and start practising real-time trade forex in a risk-free environment. “Demos” are the perfect forex teaching tool.

Is It Sensible To Trade Forex With Little Knowledge Of The Markets

Some people need to feel the grass in their teeth before they see the cows producing the milk, to trade forex is the same idea. If you’re one of these adventurous types, then go ahead and open up a demo account without reading a thing about forex. You’ll either “get it” or you won’t. If you’re serious and you understand what’s going on, proceed to a “live account”. You’ll probably do well. If you’re serious but don’t understand what’s going on, then back off and do some research. After all, forex is largest capital market on Earth (in terms of daily turnover) and knowing more about something so potentially profitable can’t hurt you. Research regional volatility variations of the AUD/USD and EUR/AUD; notice what happens on Fridays.

Avoid Typical Newbie Mistakes As You Trade Forex

Almost all newbie mistakes result from 2 errors being made. First, not enough research is done ahead of time. Second, not enough demo account practise is logged in ahead of starting “live trading”. When these 2 mistakes are combined together, tragedy can only result. Protect yourself. Spend as much time as needed doing the research that you need to accomplish. Then, sign up for 2 or more demos and practise trying to make perfect trades with perfect leverage ratios, perfect stop losses and perfect pricing targets. Do it again – and, again – and, again – to the point that you can make a profit 6 out of 10 times. Then, if you wish to start risking your own money, go “live”.

Trade Forex And Make Your First Profit

After you sign up for a demo account, try out this trade (in order to see if you can make a profit from “day trading”). Open up a 1-hour chart of the AUD/USD and put a “Williams Alligator” on it. Now, take a look at the shortest moving average line (it’s usually coloured green). That’s your trade signal line. When it crosses over all the other Alligator’s lines, you should enter your trade in the direction of the signal line. Then, you should stay in the trade until the signal line re-crosses over all the other lines. You might get 1 or 2 trades out of this strategy per trading session, with each trade rewarding you with approximately 20 pips.

 

 

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