The difference between the concept of forex in a book and in life
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What is Forex according to scientific…
If you search for the word “Forex” on the Internet, you will find many definitions. Their main essence is that this is a legal and institutionalized market in which the main players are large banks, but traders and various financial organizations that are interested in currency exchange can also participate.
What’s really…
Talking about the market in human language, I consider it necessary to answer the basic first questions of beginners that come to mind when people hear about the FOREX financial market. “Forex is a scam”? Most people are skeptical about the market at first, thinking that it is a scam, a scam, and a casino. Where do the legs of such thoughts come from? The thing is that: a) there were funny cases in the market with the bankruptcy of such “Forex companies” as ForexTrend, MMCIS, etc. These companies were built on the principle of financial pyramids, where profits from investments were paid out of new deposits. And no one thought much about bringing clients to the market. b) the existence of so-called “boiler” forex brokers on the market. A boiler company is a company that will lead you in every way to a quick replenishment of your account, and that’s all. They are not interested in your earnings and your “profit withdrawal”. So where should a Forex newbie start?
5 steps for a beginner in Forex
In this section, we will look at how to make money on Forex from scratch, that is, we will tell you a step-by-step algorithm of actions, after reading and following which you can successfully start a career as a trader in the foreign exchange market.
Step 1 Selecting a broker and opening a Demo account
Almost any dealing center (DC) is suitable for this step, the main thing is not to end up in the “boiler room”. I recommend opening an account with large companies, since along with a demo account you will receive additional customer service. The site also has a page of promotions for traders from well-known brokerage companies, there are comparative characteristics and reviews of companies. This material will help you decide which company is most interesting for you to start working with. So, from words to action, let’s open a demo account.
Many brokerage company consultants give advice on opening a demo account the size of a future real account. This may be partly correct. At the first stage, you don’t have to bother with this, open a demo account for a large amount, and play around with opening and closing positions as much as possible, without risking your own money.
Step 2 Trading terminal
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Today there are many terminals for trading, I recommend focusing on the most common – these are MetaTrader 4 and MetaTrader 5. Both terminals are very interesting, the most popular at the moment is MetaTrader 4, but the metaquotes company itself is now actively promoting MetaTrader 5th version, there There really are a lot of interesting features. So if you are just getting acquainted with Forex, I recommend that you start with MT5 and get comfortable with it right away.
Important! Customize the terminal to make it easier for you to understand the chart. There are different color schemes; for example, I like black candles on a white background. This allows me to see the graph as clearly as possible.
Step 3 Understand stock terms
To make it easy for you to further communicate with the broker on forums and understand account readings, consider basic terms such as:
- Drawdown
- Trading lot
- Margin
- Equity
- Buy Limit/Sell Limit, etc.
You will find some of these terms in the trader’s dictionary, which is presented on the website. The rest, more specific, are already available on the Internet, if necessary. I recommend not to bother too much, you won’t need all of them anyway.
Step 4 Master the basics of technical analysis
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An effective start for a novice trader is almost impossible without mastering the base of technical analysis. This step is very interesting and important, as it will allow you to lay the foundation for successful trading. Of course, it’s difficult for a beginner to figure out what to read and what not to read, there are a lot of books, and it will take a lot of time to process the information if you don’t select the most important ones. Now I will try to put forward those areas that you should look at, specifically based on the book. We will study Jack Schwager’s book “Technical Analysis”
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IT’S BETTER TO TRY AND REGRET THAN TO REGRET FOR NOT TRYING…
Omar Khayyam
In my opinion, the book is quite large, more than 700 pages of information. In practice, you will only need some knowledge from this book.
What I think is worth reading:
1) Part 3, from page 44 “Trends”
This section will help you understand how to determine the trend in Forex using a chart based on price. This is very important, because by being able to correctly determine the medium-term direction of the market, you will already be able to earn money.
2) Part 5 p. 85 “Support and resistance”
If you search for the word “Forex” on the Internet, you will find many definitions. Their main essence is that this is a legal and institutionalized market in which the main players are large banks, but traders and various financial organizations that are interested in currency exchange can also participate.
If you look at the “support and resistance” zones from the fundamental side, then in short these zones can be designated as a zone of preponderance of market players’ forces. Support is formed in the place where the bears are no longer willing to sell the asset, and resistance is in the place where the bulls are no longer interested in buying a trading asset. Read more in detail on the pages of the described book.
This knowledge will be quite enough to start trading on financial markets, be it the foreign exchange market, the cryptocurrency market, the commodity stock market, and so on.
Step 5 Select a trading system
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Most of the sites you will visit or have visited will tell you that you need to have a trading system. Of course, having a trading system is important.
At the moment, a lot of systems have already been developed, so I recommend that you do not “reinvent the wheel”, but use ready-made TS trading systems.
Start with automatic trading systems (ATS), these are the same trading systems, just written in the form of code, which can be run in a strategy tester, and if successful, launch into trading. It’s easy and convenient and, most importantly, it will show you that consistency brings profit in the market.
You can get one of these trading systems in the form of a robot trading advisor on this website for free.
Here is the online monitoring of this advisor -
To test trading strategies, as I mentioned earlier, learn what a strategy tester is in the MetaTrader 4 terminal.
Master the strategy tester. This will allow you to make another successful contribution to a successful start in Forex for a beginner.
Master the strategy tester. This will allow you to make another successful contribution to a successful start in Forex for a beginner.
Tips for a beginner in Forex
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Tip #1! – Don’t rush, at the beginning of the journey you can make a lot of mistakes. First, spend at least a couple of weeks studying this topic. Next, start practicing on a cent account!
Tip #2! – Explore the trading terminal! First, you need to master the terminal, since you need to know how the device with which you will earn money works!
Master the strategy tester. This will allow you to make another successful contribution to a successful start in Forex for a beginner.
Tip #3! -Distribute risks; this advice, if handled correctly, will 100% allow you to increase your capital!
The point is not to put your eggs in one basket, because… Neither manual trading nor a trading robot will give you 100% reliability. It is better to distribute your capital across multiple sources, for example, 10 trading advisors and several manual trading accounts. As a result, if manual trading or one of the advisors fails, you will still be able to achieve positive results.
That’s all, trade systematically, make money, see you next time.
