Forex trading involves high risks. Most trades turn out to be unprofitable or generate minimal income. Only a small fraction of newbies become professional traders who support themselves from forex.
Is it realistic to make money on Forex?
Advertising from forex brokers promises quick and easy earnings. This is only partly true.
From the outside, the trader's activity is simple - you just need to open buy or sell orders through the trading terminal. But a deal is preceded by a lot of work: fundamental and technical analysis, trend determination, etc. To correctly determine the moment of entering and exiting a trade, knowledge and experience are required.
Getting a permanent income from Forex trading is possible if a number of conditions are met:
- a person trades regularly and a lot, does not try to make a big profit from 1-2 successful trades;
- the main recommendations developed by successful traders are followed;
- analyzed successful and unsuccessful transactions for self-improvement.
- Simple rules for a successful start in Forex
To receive income from forex transactions, you need to follow a number of recommendations:
- It is necessary to study the techniques of fundamental and technical analysis. There are articles and whole books, video courses, etc. in the public domain. The materials will help you understand how price movement forecasts are made. Information is systematically presented in video courses offered by forex brokers.
- Trading is impossible without reading charts. You need to understand what information is provided in the trading terminal, what the top and bottom of the candlestick mean, etc. After that, you can deal with technical indicators.
- Choosing a strategy is a must. The strategy allows you to determine when to buy and when to sell an asset. If you act on a whim, you can lose money even in the simplest situation.
- Psychological stability is extremely important. A bad trade does not mean that the strategy is wrong. And a large profit should not instill excessive confidence in a trader. All transactions should be conducted with minimal emotional involvement. Experts recommend depositing an amount to a trading account that will not be scary to lose.
- The principles of money management are unchanged. The transaction amount should not exceed 5% of the deposit amount. A standard order should be 1-2% of the available funds.
- You have to find your own path. There is no universal way to make money on Forex. The trader must choose a currency pair, strategy, technical indicators and more.
Trading on a demo accountAlmost any broker provides clients with a demo account option. A person receives virtual currency for trading. This is a good way to test your forecasting and chart reading skills.
All functionality on the demo account corresponds to the real one. Unsuccessful deals lead to losses, and at the expense of profitable ones the balance is replenished. If during the week a person was able to trade without loss, then you can go to the next level - to a cent account.
In case of failure, you can replenish the demo account balance with one click, without any costs.