What you should know before you start?
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  1. #1
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    What you should know before you start?

    Greetings, traders. My names is Stanislav aka Stan, some of you might know me for webinars I do on a weekly basis (know more about it here)

    If you are just starting your trading path, there are some short advices that can significantly accelerate your learning curve. Some of those thoughts may seem obvious to you, but that's what trading is:


    1. Use simple approach.

    Whatever market you trade, avoid complicated methods - make it as simple as it can be. There's no hidden truth there, price is often the only thing you need.

    Most professional traders use naked price chart with couple of moving averages and maybe some sort of oscillator (Envelope, Bollinger bands), identify levels of support and resistance and have 2-3 primary setups to capture profit from price action.

    In analysis, we don't have much time to stare at the charts, we need to keep it simple (yet it's not easy) and be able to find preferred setup in 3-5 minutes. This is only achievable when we have limited set of tools and know exactly why do we use them. Too much analysis is not useful, no analysis is also harmful.


    2. Journal your observations, not other people's theories

    The essential of success is keeping a journal, which will later give you confidence. You will have much better understanding of price action journaling and observing than simply following somebody's opinions.

    Don't believe anybody blindly - test, test and test again. Do more what works in current market conditions and do less what not works.

    This will help you build appropriate mindset - markets always change and trader should be able to adapt to those changes. Don't rely on books and theories too much - I suggest you not to read books absolutely for 3-6 months if you are just starting. It's nothing wrong with books, they are beautiful, but they can confuse your mind and build unrealistic view on trading.



    3. Know your "pain point"

    Know amount of money you can afford to lose in a single trade and in trading in whole. Remember - statistics is not on your side when you start trading. Chances are pretty high that you will struggle for some time before gaining experience and obtaining good trading skills.

    Also, you should prepare for elongated learning curve. If you are not ready to continuously learn, absorb information and work on yourself, may be trading is not for you. It's a marathon and only steady runners reach the point.

    If your "pain point" is too close (you don't have time or capital), you will probably quit before you will be ready to make it.

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    Last edited by Value trader; 09-25-2013 at 07:45 PM.

  2. #2
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    Understanding the risk associated with Forex trading is very important for everyone.Though Forex is a very potential money making opportunity its not easy. We have to first learn and acquire good knowledge and skills before we can jump into Forex trading. Discipline is also very important to survive in this business and follow its money management rules.

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    Rookie mohamed reda's Avatar
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    in fact any new trader do not have the enough information about how to trade Forex or how to make profits so he must face some difficult to trade Forex or to make profits so we can say that learning is so necessary for any beginner trader to have the enough experience about how to trade Forex and to be able to make his profits from this market and the best way to have this experience is training with the demo account for along time .

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    Quote Originally Posted by mohamed reda View Post
    in fact any new trader do not have the enough information about how to trade Forex or how to make profits so he must face some difficult to trade Forex or to make profits so we can say that learning is so necessary for any beginner trader to have the enough experience about how to trade Forex and to be able to make his profits from this market and the best way to have this experience is training with the demo account for along time .
    You are very true , all people can not work in forex field or even achieve success without any experience, So it depends on the training of knowledge and get more experience for a long time and make practice to trade on demo account and then enter the real account with small capital and continues to train and study by day to day to make the trader learn new things. With that they will know what things must doing before start trade in this risky business

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  5. #5
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    For newbie, just focus on one currency pair, no need to 3-5 pairs. It much easier to learn about characteristic of currency pair.
    Most people will recommend EURUSD because of high volatility and low spread.

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  6. #6
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    Of course, you should know the above mentioned points by Value trader!
    And also you should know about trading. I have seen many newbies, who dont know single thing about this business and just directly jumps to live trading and on first day they make a lot of profits because of luck and so they never learn and on the long term they are unfortunately they are the loosers.

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    Rookie martyn's Avatar
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    true, we better do a market analysis based on our own observation journal. because although we are still beginners, we have to start learning to keep a journal of our own making observations, so that we will not be too dependent on others, and also when we are defeated, we still could take a lesson from the journal observations that we make, so our ability to analysis of a growing market

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  8. #8
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    In my view I need to see the previous market for my new trade. I need to understand the proper movement of the market. If we are not able to understand the market flow so our mission will be failed. So we need to teach our lesson from the past for the next future.

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  9. #9
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    Quote Originally Posted by RainFall View Post
    In my view I need to see the previous market for my new trade. I need to understand the proper movement of the market. If we are not able to understand the market flow so our mission will be failed. So we need to teach our lesson from the past for the next future.
    And also you must before the start of trading to learn strategy and its good experience based on the demo account in order to achieve top results afterwards and should also focus on some tips from top professional traders such as capital management and stay away from greed dramatically

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  10. #10
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    The most important thing I have to do before trade, I always calculate Daily Average for that pair and analyze it to make sure that today I still have chance to get profit.

    For example, If I want to trade EURUSD, (which in this month have Daily Average about 70 pips), I always make sure that today price movement not reach 50 or 60 pips yet,, so I could try to get profit about 20 pips.
    The next procedure is calculate/prediction TP level, so I can set the OP level. (TP level minus/plus 25 pips).

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