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5 tips for new forex traders


Jimmy Cook

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5 tips for new forex traders

 

Forex trading is full of opportunities but also riddled with pitfalls. The thrill brings in new traders constantly but most likely they are there for the easy money that was promised in an ad somewhere. Unfortunately, these riches are available only for a lucky few who get it right on the first trade. For all the rest of us being careful, having a solid trading plan, good trading conditions by the broker and low fees are a must to stay profitable. So here are 5 tips that could help you push your trading career to the right direction.

 

1.  Start with a demo account. When you first go out to the world of forex you will have the risk free opportunity to trade on a demo account. This will give almost identical conditions for trading a real portfolio with all the ups and downs of the market. Just be sure that you treat the money on a demo as you would on a real account. This will give you a realistic feeling what could happen to your hard earned cash. Caution though when using the demo to judge the performance of trading systems which have a large number of trades, this is one place where the real results can later be lower as slippage comes to play.

 

2. Choose a broker that gives you low trading costs. A big part of any forex strategy staying profitable is the cost you pay on every trade. This is especially true to very active trading styles making 5 or more trades a day. These days the low end of commissions can be as little as $2 per $100,000 traded.

 

3. Don’t be lured in by huge bonuses of 100% and more by brokers. A good broker might give you a nice boost to start with a 25-50% bonus and you have to appreciate it as brokers give away their profits even if their trading costs are already the lowest in competition. But don’t run for 100%+ bonus offer as attractive as they may sound, these are mostly cold calculations by low moral brokers to lure you into making large deposits after which you will be riddled with fine print in conditions, withdrawal restrictions and high commissions. You have to understand that these brokers will want to make their money back from you as fast as possible.

 

 4. Look for ECN/STP brokers. A broker using either of the technologies is more likely to be on your side. Why? Because they don’t keep your trades in house. A STP or straight through processor will send your trades to the open market place and has nothing to win from your losses than a sole B-book broker which trades against you and wins everything you loose and also loses everything you win. You can see the conflict of interest here as they have the upper hand here.

 

5. Don’t always go for the highest leverage accounts. While some brokers will offer you 1:1000 leverage on your money this also increases the risk both for you and your broker. Leverage like that means that it is solely backed by the broker you trade with as no prime brokers give leverage like that to the end user serving forex broker. This means it is not doing STP (read point number 4) and just wants you to lose as fast as possible for their gain. A leverage of 1:200 or less is beyond most people’s needs and is something you should go for. For comparison US regulated brokers aren’t allowed to give more than 1:50 leverage.

 

Written by TradeWiseFX Team -

 


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You forget few things First, choose the broker which highly regulated and the second take a look at broker whose offer reputable payment processor and not payment processor which have some problem in past or doesn't regulated. I agree with fourth point, it is a good to choose STP/ECN/DMA broker than dealing desk broker.

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So i think they should do that isn't it? But how to do that? I mean each trader has their own view about something isn't it? Maybe your practicing way isn't as good as them, but for the others that is a good way and already proven to them. I experienced this thing before so i know it well, but the universal truth here is that you should keep doing that over and over again. This is what newbie lacks their spirit is low, only once, twice or even thrice they are bored. I think 6 months is the lowest round for practicing and make sure trade at least once or twice in a week during that time.

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Don't have much expectation, and that is what all i can say about newbie, just getting more realistic or a bit pessimistic. Always think how to manage the risk first, and if somthing wrong you can start to close the position as fast as possible so you won't lose further or your profit becomes zero.

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  • 1 month later...

Don't have much expectation, and that is what all i can say about newbie, just getting more realistic or a bit pessimistic. Always think how to manage the risk first, and if somthing wrong you can start to close the position as fast as possible so you won't lose further or your profit becomes zero.

 

Big expectations of newbies came from their greed. That's why we need to be discipline in order to not involving our greed when it comes to trading on real account with your funds.

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  • 4 years later...

Trading currencies – in short: Forex Trading – turns out to be increasingly well known. Particularly retail speculators began to buy and sell currencies rather than stocks. Compared to stocks or funds, FX trading offers more chances to make gigantic benefits, but on the other hand there's more risk included. It's likewise conceivable to lose every dollar in your trading account. There's no market that is as fluid as the Forex market. Currencies are purchased and sold each second. Internet trading platforms are ready to exchange consequently and to follow calculations that were created by people.

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One can say that these are very useful tips and you can get good help with these tips if you want to trade Forex successfully. So always learn the basics of Forex and then go with demo account to do some practice which will be helpful to become a successful trader.

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  • 2 weeks later...

My formula to make profits in Forex is simple and that to work according to a proper plan and strategy. And that if combined with risk/money management, it turns into just ideal recipe for achieving success. I get helped with it in major count through FreshForex broker using the razor thin spreads, no issues over slippage and various such benefits. They have superb Market Analysis too to help with working nicely.

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  • 3 weeks later...

If you are going to trade in Forex market, you need to have proper knowledge first. Without any knowledge you can not make trade in this market. You can get all kinds of knowledge of forex market by creating a demo account under a regulatred broker like Forex4you. A demo account will help you to know all the basics of forex market easily and practically.

To trade in demo account there is no need to invest any money. So, it has no risk at all. You can learn all the rules and techniques about Forex by trading in demo account. You can learn how to trade, when to trade, where to trade and amny more things easily from the demo account. Every new trader should use demo account before starting real trading with their money.

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