The briefest web search on “how to learn Forex trading” will provide you with numerous results, most of which lead you back to Forex dealers and brokers offering themselves up as a resource on the subject. These providers uniformly claim to have crafted the best and most perfect system to teach you how to trade forex, promising almost mind-boggling results if you’ll only buy their DVD’s, course books, seminars, and the like.
How can a newbie genuinely interested in learning how to trade forex distinguish between these competing offers and identify the best source for their needs?
If you’d like to learn how to trade Forex, it’s true that taking advantage of any of these internet-based offers can probably be helpful to you, but not for the reasons touted by the websites: the reason to access any of the available web-based sources is not because any one offers a better system than the other, nor because you can expect to earn higher profits using one as opposed to another, but rather, because all of these programs provide a perfectly acceptable basic set of information about the Forex markets and how they work.
Regardless of whose tools you decide to use, you’ll receive a set of educational materials essentially comprising Forex Trading 101, with a “syllabus”, or contents, equipped to teach you everything you need to know about currencies, liquidity, leverage, pips, stops, spreads, charts and chart analysis, candles, fibs, support and resistance, and everything in between. Studying these materials will give you the knowledge base that you’ll need to learn Forex trading, but reading these materials is just a start: in order to truly learn Forex trading, you’ve got to practice Forex trading and put your new found basic knowledge to the test. Just like the old saying about getting to Carnegie Hall, the key is to practice, practice, and practice.
Once you’ve acquired the basic knowledge, you’ll need to sign up for a free demo account with any of the numerous Forex firms who offer them; even better, open up more than one, so that you can practice in a wider berth while getting acquainted with a variety of different platforms. Practice virtual Forex trading with these accounts for as long as you can to familiarize yourself with what’s really involved in taking and closing out Forex positions. Chances are you’ll lose more virtual money than you’ll make, but the experience is invaluable, and should be humbling: certainly, you should not start staking your trading activities with any real money until you’ve figured out how to make a profit with virtual money.
If you can, find yourself a Forex “mentor”. This does not necessarily need to be a professional, but can simply be someone who’s already experienced a measure of Forex trading success. Discuss your virtual losses (and gains, if any) so that you can benefit from your mentor’s greater experience and objective insight into what you’re doing right, and what’s wrong. Take their comments in stride and incorporate whatever tips and advice you can glean from them into your trading strategy.
Above all, keep reading. Never stop educating yourself about currencies and the currency markets. Stay abreast of the kind of developments that can affect currency rates, whether economic or political. When you’re ready, open a micro account, stake it with a small amount of real money, and wait for the signs to indicate that it’s time to make your first trade. If you’ve followed our advice, you’ll be ready to begin.