Is it possible to make money on Forex? My memories two years later. Forex trading for beginners. Principles and concepts. How to earn? Is it possible to make money on Forex?
Is it possible to make money on Forex? How to make money on the Forex market? How often do you hear and read these questions on the Internet? Previously, when I was completely out of the loop, it seemed like something mythical to me.
Today, of course, I know much more about Forex, but I will never forget those first days that I spent on the foreign exchange market. I was also interested then Is it really possible to make money on Forex?. It turned out that it was real, but very difficult.
In this article I will not describe how to make money on the Forex market, but I’ll just tell you what I experienced when trading. Believe me, every trader experiences these feelings, these emotions, so using my example you will be able to draw your own conclusion whether you should start trading on the foreign exchange market or not.
Memory 1
With low income there is nothing to do with Forex. I thought that with $100, you could grow to several thousand, or even more. But this is all bullshit. There are no miracles. In order to have real opportunity To make money on Forex you need to have a large starting capital. Believe me, everything that they write about mini accounts, and also about the fact that with 50 bucks you can short term making a few thousand dollars is a lie. If everything was as they say, then today there would probably not be a single dealing center, because they all went bankrupt. Especially those that do not withdraw money to the interbank market. Therefore, my first mistake was that there was no point in putting little money into the Forex market. I just didn’t know if it was possible to make money on Forex, so I wanted to try it. I tried it and ended up donating my money to the dealing center.
Memory 2
Of all the types of online earnings, Forex is the most difficult. Difficult, first of all, because you need to be a specialist in finance and economics. And let them say that it is possible to make money on Forex without theoretical knowledge of economics, but in reality all this is bullshit. You need to know too much to always stay afloat. In addition, you need to sit in front of the monitor screen all the time and monitor positions. It won’t work any other way if you don’t have much money in your trading account.
I remember how I sat near the monitor at night waiting for a profitable trade, and when the price finally went in my direction, I opened, but in the end everything worked out in such a way that I ended up having to sit almost all night to close this position . In general, instability.
Memory 3
Forex is not for the faint of heart. Even though you know how to make money in the Forex market, it will take you more than one year to become a guru, and it is not a fact that during these years you will be able to stay afloat and be able to afford to feed your trading account with new injections of money for a long time. And when you threw away these unfortunate $100-$200 and situations arise in the market when you can lose everything, you are constantly nervous. That is, this work is directly related to risk. And there is no escape from this. But risk is not for me. The appearance of gray hair is the result of constant worries. Therefore, it is better to save yourself for more important matters, unless, of course, you don’t care about losing a thousand or two dollars.
Memory 4
Everyone is interested Is it possible to make money on Forex, but not everyone immediately understands that in this type of business you are constantly spinning, like a squirrel in a wheel. Not only do you need to predict the direction of price movement, you also need to get around all the obstacles that the dealing center or broker puts up. They also need to feed. And believe me, what is rumored to be important to the employees of dealing centers, first of all, is that you bring them your money. They need profit. And they make their profit at the expense of us, that is, at the expense of the clientele.
Therefore, I don’t know if it is really possible to make money on Forex when there is such pressure. Very often, dealing centers and brokers resort to various kinds tricks. Especially when the price is falling quickly and you need to close your position. The broker does not respond to your requests and then explains all this by saying that the servers were overloaded with requests. This is all bullshit. We would like to improve the system of executing orders so that everything would be without delay. But it's not in their interests, so time is running, but everything remains the same.
Memory 5
Forex trading is risky. And quite significant. When you deposited your $500 in hard-earned money into your trading account and slowly watch how this money melts away in your trading account like oil in a frying pan, you don’t experience the most wonderful feelings. In general, well, well. I am for stability. Because in Forex today you can win $1000, and tomorrow you can lose $2000. Believe me, this happened to many. There are almost no people who quickly withdraw all their profits. And if someone wins today, then tomorrow he will lose, and will lose even more. This is reality.
Memory 6
I was trained in trading using a training package that I bought at one of the dealing centers. I’ll say right away that the package was not bad, with video materials. Only now, when it is possible to use the Internet, such educational materials are losing their relevance. All those who are interested in how to make money on the Forex market and whether it is possible to make money on Forex can find numerous materials on various sites on the Internet. Believe me, they write the same thing in print media. Why give money when you can get it for free?
Conclusion
These are the main memories of those times when I still considered myself a trader. By the way, believe me, my pessimistic moods have nothing to do with the results of my trading. I'll say even more. I even won for a while. But according to the law of meanness and due to human psychology, when you get excited, it’s already impossible to stop. Therefore, even if you win a little money, you are unlikely to find the strength to withdraw it from your trading account. You want to win even more, but in the end you lose everything you have.
In conclusion, I will say that not everything is so pessimistic. If you are looking for an opportunity to make money on Forex, then get ready to start with a normal amount, at least $1000. And start working at least with a normal broker, and not a kitchen. The largest Forex market giants in the CIS are the Alpari and Forex Club dealing centers. I won't even recommend others. And remember, earnings directly depend on greed; the higher the degree of greed, the greater the risk and the greater the likelihood of losing funds on Forex. Don't forget about it!
Have you ever wondered what the meaning is in the expression “ real Forex” or “real trading”? What is Forex and why is it a source of pure income for some, while for others it is just another disappointment on the difficult path of freelancing?
Against the backdrop of such a variety of different opinions about the Forex market, we will try to highlight a certain abstract concept, which, nevertheless, can illuminate the path to success for anyone on the Forex exchange. And we will call this concept . So let's get to the point.
Real Forex. An inside look at currency trading
All beginners are attracted by the apparent simplicity of trading on Forex: a couple of mouse clicks and dollars flow into your e-wallet. However, not everyone accepts this reality, since to achieve such a level of skill in Forex trading it requires dozens of hours spent watching training videos and “tons” of studied literature. Hardly everyone sees a lot of unprofitable trades among the numbers on the account on the way to honing their own Forex trading.
Therefore, the first point of the concept is “ real Forex", there will be an awareness of the need to master the profession of a currency trader. That is, a psychological factor.
You need desire and patience to really make money. A string of losing Forex trades should not dampen your desire for success. Never stop practicing and learning. There are plenty of successful traders who earn decent amounts of money per day. They started trading on Forex just like you. You should only focus on them.
The need for rest in Forex trading
If you are tired, rest. Forex will not disappear anywhere, but “shaky” nerves after dozens of unsuccessful attempts will not allow you to choose the right trading strategy and. By the way, the last two points make up the second part of the “real Forex” concept. This is the technical side. And this is an integral essence of working on Forex, which requires all your knowledge and skills, the ability to anticipate and analyze the Forex market.
Any successful trader in Forex has an individual approach – Forex trading system. It takes days, weeks, months to develop it.
However, having developed a scheme “for himself”, the trader is not afraid of failures and confidently steps towards success. Of course, you can trade intuitively. Intuition plays important role in Forex trading. However, completely relying on your own “gut” is frankly naive. “Real Forex” involves only measured but clearly thought-out steps.
2. Crossing of trend lines. A signal about a TL cross on Forex (especially one that has been repeatedly price tested) is a “go-ahead” for an early entry or exit from the market. One cannot ignore the data of technical analysis of the Forex exchange market, without which this signal may not be as effective. Typically, trend lines act as resistance and support levels.
The following four Forex tactics represent variations based on the second type (TL cross), so we’ll just list them:
And, of course, you can’t ignore it. The concept implies studying the market by tracking price dynamics in real time and further making forecasts.
Knowing just three main rules of technical analysis, you will be able to more or less clearly navigate and make successful forecasts:
Real Forex takes into account any factors. Economic changes, fluctuations in the political sphere and many other things that affect the price of the instrument have already been taken into account and included in the price.
Based on the above, it turns out that the price chart is the only thing needed for successful forecasting.
Prices have trends. This means that the price may vary.
But these changes can only be of two types:
- up (a bullish trend has begun)
- and down (bearish trend prevails).
The third trend is a corridor (sideways trend). A “long corridor” is a sign of powerful price movement.
Repeating history. This postulate implies the constancy of physical, economic and general psychological laws. Simply put: what influenced the price in the past remains unchanged in the present.
Thus, the concept of “real Forex” includes only two components:
1. Psychological aspect,
2. Technical aspect.However, behind these two points there are dozens of hours of preparation and training, successful deals and failures, disappointment and joy from the realization that intelligence can be well paid.
Practical tips for trading Forex
This month I earned +120% on my deposit on Forex. Do you think becoming a millionaire at 25 is realistic? How to make millions without leaving your couch? Do you want to know how to make huge money while lying on the beach, by the sea?
Agree, the first thoughts that come to mind after listening to the above-listed advertisements for absolutely all dealing centers (hereinafter referred to as DCs), isn't this a scam?. We are all adults and we understand that free cheese can only be in a mousetrap, and here they promise mountains of easy money. And yet, after thinking a little, we take our money and try to find out in practice: " What if I was wrong and this is a real way to make a lot of money on Forex?".
The X hour comes and the newbie trader makes the stupidest decision. In hope make money on the Forex currency market, a trader goes to study at a company that makes money from traders. Unclear? OK, I'll tell you in more detail.
Dealing center- a company that provides traders with a trading platform and access to the Forex market. In most cases, DCs make money not from commissions from traders’ transactions (as it should be), but from the ruin of the trader. In case of a complete loss, money from the trader's account flows to the dealing center account.
A new trader goes to study at precisely such companies, and as you understand, they teach him not how to make money, but rather how to lose money. They explain in detail what a trend line is, how to work with support and resistance lines, they will even show trading formations (patterns), give examples on the chart, and for particularly meticulous students, for greater persuasiveness, they will present detailed statistics of transactions where the numbers +1000$ appear, +$2500 and so on, well, you understand, the larger the amount, the more convincing the teacher looks. The DC teacher will also not forget to mention the statistics according to which 95% of new traders lose their money in the very first transactions and no longer return to the foreign exchange market.
At first glance, everything looks just great, no deception, they told, showed, and even warned, but all these stories only affect inexperienced and greedy people. The fact is that a trend line can be built in different ways, and it will be great to draw it only on history, and the patterns that the Teacher so boasted about have not worked for a long time, because the foreign exchange market is alive, it tends to change, and what worked yesterday , very often will not work tomorrow.
Well, the statistics are against us, or rather against the majority, who do like everyone else, but this is not the most important thing, the main problem is that we started doing something that we initially assessed " Isn't this a scam?". This thought will sit until the very end, and what is very sad is that this end comes very quickly.
Having tried to trade, a newly minted trader rather thinks not about the quality of the transaction, since he was not told that something could be different, but about the how to make money quickly on the Forex market and what you can buy with the money earned from the exchange. Are you familiar with the proverb " Sharing the skin of an unkilled bear"When you start doing this, it usually doesn’t work out, and for a novice trader multiplied by 100 does not work, because he does EVERYTHING wrong. Having received the first knowledge, he did not deign to test it; his head was filled with transaction statistics provided by the teacher from the center and illusions about quick riches.
But this does not happen and instead of wealth, expecting to earn money, the trader loses his hard-earned money. What do you think he will say to others? Of course, Forex trading is a scam, everyone is to blame: the DC who lured him in with advertising, the teacher from the DC who taught him poorly, but in no case is the newly minted trader himself to blame, after all, no one told him that before making money, it would be a good idea to learn this. His head was filled exclusively with wealth, new cars, apartments, yachts, he already saw himself in a new image, but to think about the mundane, that people only study in institutes for 5 years, of course, he didn’t want to think about this, because money need fast ones.
How to make money on the Forex market. The essence and principle of action
Forex (Forex, sometimes FX, from the English FOReign EXchange - “foreign exchange”) is a market for interbank currency exchange at free prices.
I hope that now you are mentally prepared that you will not see easy money, but in return you will have to study, study and study. If you don’t understand, go back and re-read the introduction again, the rest “Follow me!”
To get started, check out the Trader's Library. I have prepared a good range of books on the topic “how to make money on the stock exchange”, which is suitable for both novice traders and more experienced ones.
Let's understand the theory of how to make money on Forex.
How to make money in the Forex market?
Many of my friends know what I do. For them, the word “trader” is associated with something grandiose, but somehow the conversation turned to the practical part, and they asked me: “ How exactly do you make money in the Forex market?". Frankly, this was a strange question for me, because I thought that the explanation was on the surface: bought cheap, sold high, profit in your pocket.
But since people are interested, I’ll try to answer in a simple form, using a banal example:
According to reliable data, you found out that in a month soap will cost 15 rubles, although now it costs 10 rubles. How to make money from your information?
You need to buy soap now for 10 rubles, and when it costs 15 rubles, sell it and get 5 rubles from this transaction. The task is simple, but this simplicity is the essence of making money on the Forex market.
Trading on the foreign exchange market takes place through special terminals, of which there are a lot. For trading on the Forex market, the MetaTrader 4 terminal is usually used (in one of the articles I will describe in detail the functionality of the platform). Trading operations are carried out using the terminal (Sell, Buy, etc.)
The principle of making money on the Buy position (purchase)
let's consider real example how can you make money on currency speculation on Forex.
Buy order for the EUR/USD currency pair
1 lot in the EUR/USD pair = $100,000
1 point at open trade 1 lot = 10 $
Let's draw an analogy with our example about soap. Just like with soap, for some reason, the trader decides that the price 1.2928 is cheap. The trader makes a Buy deal with the 1st lot, in other words, tries to make money on a short-term rise in the price of EUR (euro) relative to USD (dollar). As soon as the price reaches the level 1.2973 , the trader closes his position (sells).
Let's do the calculation. Between 1.2928 And 1.2973 the price has passed 45 points, 1 pp = 10$ , it turns out that the trader made money on this transaction 450$ .
The principle of earning money on the Sell position
The example with soap will not work here, but even without it the essence will be clear.
Sell order for the EUR/USD currency pair
Let's look at the following example of making money on Forex, in which a trader wanted to make a Sell transaction. The question immediately arises: " What about selling? After all, in order to sell something you don’t need to buy something". Absolutely true, but in the foreign exchange market there are slightly different rules. The transaction center allows you to make a sale, as if in debt, so in the foreign exchange market this transaction is quite real.
And so, the trader decides that the price 1.2960 for the EUR/USD pair is overvalued and is awaiting a short-term decline. To make money on his expectations, a trader should price 1.2960 make a Sell transaction and wait for an acceptable price at the level 1.2893 . After closing the transaction, funds will be transferred to the trader’s account based on:
Sold at price 1.2960 , deal closed (bought) at price 1.2893 , in the end it turns out that the couple passed 66 pp, which in terms of money equals 660$ .
How to make money on Forex online
Selecting a DC to register a trading account
Now that we know how, in theory, traders earn money by speculating in currency pairs on Forex, we can consider several options for Dealing Centers for opening a trading account and withdrawing our money to the exchange.
It must be admitted that nowadays Dealing centers are a dime a dozen, for this reason it is very easy for a new trader to get confused and choose an unscrupulous company.
What do I mean by “unfair”? Will explain.
Unfortunately, in Russia (I don’t know about other countries), the Forex market is not regulated by the government. This means that the Dealing Center can register its companies, for example, in Cyprus and, in case of controversial issues, litigate under Cypriot laws.
How many will do this? I think no.
For this reason, DCs are often compared to a “kitchen”, which means: the transactions that traders make are not brought to the market (exchange), but are handled exclusively within their company. There are several reasons for this:
- Knowing the statistics of losing traders, the DC thinks as follows: “Why put a transaction on the intermarket and pay for it if the trader will lose the deposit anyway. It’s better for me to arrange the appearance of trading on my simulator, leaving all the profit for myself.”
- There are traders who are able to make money, but you can also find a key to them. Which? Yes, he just can’t pay the money he earned, and let him sue who knows who.
Fortunately, the government will soon take the side of Russian traders, if I’m not mistaken, in October 2015, the Duma will adopt a law on regulating the Forex market and present requirements for brokers (Dealing centers). Now, to the question: " How to make money on the Forex market?", there will be only one answer: " Analyze, learn and earn, now no one bothers you".
In one of the following articles, I plan to describe this law in more detail and break it down.
The law is the law, but we shouldn’t screw up, we can’t make the mistake of choosing a fly-by-night company. I suggest you choose 3 reliable brokers. Their reliability lies in the reviews of our fellow traders and the age of the company.
Moreover, at a time when the Internet is moving by leaps and bounds, website design can say a lot. More than once I went to pages that deal with serious investments (as they say), but the site was made, as they say, “on its knees”: nondescript, gloomy and uninteresting.
You say: " Yes, this is not an indicator, a website can be made as beautiful as you want?“It’s possible, no doubt, but as practice shows, fly-by-night companies don’t bother too much about design. Their goal: to attract the client, fool and disappear.
1. Alpari company.
The company has been on the Forex market since 1998 and has proven itself well, both in its attitude towards clients (timely payments, high-quality functionality, experienced analysts, etc.) and in its reliability.
Besides excellent conditions For trading traders, Alpari offers wonderful opportunities for investors: PAMM accounts, PAMM portfolios, investment funds, structured products, etc. In my opinion, it is in Alpari that traders who trade profitably are collected and the yield curve of PAMM accounts is proof of this.
2. RoboForex company.
In the Forex market since 2009. Despite the fact that the company is registered in Cyprus, there are no claims regarding either the service or the execution of orders. On the Internet you can find a lot of positive reviews that add significant bonuses.
Among the features: free access to the VPS server, the “One-Click Trading” service, designed for strategies aimed at implementing large quantity transactions, the “Rebates” program, which allows you to reduce the spread.
3. Forex4you company.
It began its activities in 2007 and provides access to the interbank Forex market using the NDD model. At one time, I talked with guys who had registered accounts of $100,000, withdrew profits of 5-10% every month, and there were no complaints, delays or negative factors.
The company cooperates with several banks. The main features are: the Share4you service, which allows you to automatically copy transactions on Forex, PAMM accounts, investment security of funds: funds from 100,000 USD are stored in one of the banks in Switzerland, depositary bank services for clients investing from 500,000 USD.
Additional Information!!!
Hello, dear readers of the blog site! If you are tired of constantly making the same mistakes when trading the Forex market and losing money, then this article is for you! We will reveal secrets of experienced traders, and we’ll tell you what you need to do in order to trade Forex profitably.
We recommend that you carefully study this article, because the tips described in it will save you a lot of money and nerves, and will help you significantly improve your trading efficiency. Every earning trader on the stock exchange has come a long way through mistakes and losses. For some, this path took a little time, and for others, more than one year of hard work. We have familiar traders who began to regularly make money on Forex after only 5-6 years of almost daily trading. Such cases are not uncommon, but one pattern is visible in them - perseverance, determination, desire for financial independence and a qualitative change in one’s life.
If earlier these guys had financial problems, now they are absolutely wealthy people with earnings from 1 million rubles per month, which, you see, is very impressive!
This kind of profitability is the result of hard work and self-belief. None of them expected the result to come quickly. They sensibly assessed their strengths and capabilities. This fundamentally distinguishes them from most newcomers who come to the stock exchange to get rich quick.
Therefore, the first piece of advice on the path to profitable Forex trading is: don’t expect to get rich quick. Do your work gradually, and success will follow. This is absolutely Not means that you will learn to earn money only after 5-6 years, of course not!
| Learn to trade. Go ahead. |
We know of traders who started making money after 3 years of trading. There are even those who achieved high profitability after one and a half to two years. It depends on the abilities and desires of the individual trader. We are all different people; some people learn in a year what others cannot understand in 5 years.
When a beginner comes to Forex with the hope of quickly becoming a millionaire, he immediately falls into the trap of his expectations. Thoughts about getting rich quickly make him rush and do rash things. Haste in the market is very expensive! You cannot rush in trading; everything must be done carefully and thoughtfully. So get ready for work right away, and drive away the thoughts about a beautiful life that will definitely appear in your head :)
Your task - concentrate on the process of studying the market and gaining experience. The money will come on its own, as a result of the right actions on the stock exchange. Let's move on to the next tip.
Go straight to trading
We are convinced that a demo account is needed only to test the capabilities of the terminal, but not to simulate trading. This is due to the fact that trading on a demo account completely dulls the psychological and emotional component of the trader, which is always present and is a very significant component in real trading.
Therefore, open a real account and trade on it. Moreover, you don’t need a lot of money to open an account. For example, in, you can open an account from $100.
When opening an account, follow the following rules:
- trade only with those funds, the loss of which will not cause you a financial hole in your budget. In other words, you should not trade with your last money.
- The amount to trade should not be too small, it should be at least a little significant for you. Those. so that a loss causes anxiety, and with a profit you can have dinner in a good restaurant :) This psychological technique is done so that you can emotionally feel the losses and the receipt of money. It’s not like putting $100 into your account, losing it without worrying too much, getting a new $100 :) It’s better to immediately open an account for a normal (by your standards) amount and get ready for serious trading. This step will immediately form a responsible approach to business.
Let's move on to trading tips. We will tell you various secrets and tricks that traders use to trade Forex profitably.
Anything can happen in the market
Take it as an axiom that anything can happen in the market! The market can remain irrational until you run out of money in your account. You must always be prepared that anything bad can happen. A trader constantly deals with probability. There are no 100% situations on the stock exchange. This must be understood very clearly. Don’t look for logical explanations for this, just take it for granted, and then you will save yourself from big losses.
Books about trading
Literature on stock trading instills stereotyped thinking in a novice trader. In practice, everything happens completely differently. And precisely because a beginner expects a certain development of situations, for example, after a breakdown of some kind, it is difficult for him to refuse a forecast when the situation develops completely differently from what was written in the book. Therefore, approach literature from a critical point of view.
We are not saying that you don’t need to read anything. You will have to read a lot, but always criticize what you read and do not perceive what is written as the only truth. You are risking money, not the author who wrote this book.
Trade only currencies you understand
Trade only currencies whose movements you understand. Each currency pair has its own behavior and characteristics. Choose the one that suits you best. Don’t spread yourself thin, don’t trade many currency pairs at once. Otherwise, your attention and concentration will be scattered.
Cases when it is better not to trade
We categorically do not recommend trading in a state of altered consciousness:) By altered consciousness we mean intoxication and illness when it is necessary to take medications. When a person is sick, it is very difficult for him to concentrate, he becomes inattentive and makes many mistakes.
In essence, it turns out to be a “at random” deal. When the trader returns to the terminal, a very unpleasant surprise may await him in the form of a large loss from an unsuccessful stop order or a strong market movement against the position if the stop loss was not set in principle.
Place stop orders
Be sure to always place stop orders. Don't listen to anyone who tells you that it is better to trade without stops. There is a popular myth about the fact that big players, or as they also say “dolls,” are hunting for stops. This is all complete nonsense!
People who say this are justifying their lack of understanding of the market and their inability to set stop losses. If the market knocked out a stop, then this means only one thing - the stop was set incorrectly. A correctly placed stop order is never simply knocked out.
Protect your profits
Beginners and unprofitable traders have one a big problem- overstaying profits. This is directly related to greed. As a result, a profitable transaction may turn out to be unprofitable. Profit must be taken!
Whenever a position becomes profitable, protect it by setting a stop loss at least at the move point so that the position is at breakeven, and then raise the order as the price moves.
Follow the algorithm:
- entering a deal
- setting the initial stop,
- if the position enters the profit zone, move the stop loss to the break-even point (entry point),
- trading profits and fixing positions in parts when the market goes in your direction.
What timeframe to trade on
Try to trade from the younger time period to the older one. This technique allows you to cancel the volume that you include in the transaction. This is especially true for when you want to overclock it.
On a higher timeframe, look for availability, and on a younger timeframe, look for an entry point to get the best risk/reward ratio. Using this scheme, a good entry point can be obtained even on a minute timeframe with a close stop, which means little risk. It all depends on the accuracy of the input. Such transactions can be held for quite a long time, and they bring a lot of money, which often determines the performance of trading for the whole year.
News and economic statistics
If you are engaged in active speculation rather than investing, we recommend that you do not make forecasts based on news and economic data. Usually, the market's expectations of any news or statistics are already included in the price. When news comes out, the market's reaction can often be completely different from what you expected. It is better to analyze the chart and make forecasts using technical analysis. Profitable traders do just that.
News, market statistics and other fundamental analysis data may be useful to you when trading over longer investment horizons.
Don't overload the price chart
Never overload your terminal chart with unnecessary technical analysis tools. You will be constantly confused!
Signals from different indicators will begin to contradict each other, this will bring uncertainty to trading. Just look at this, there are so many indicators hanging here that you can’t even see the price.
Remember, the number of indicators does not increase the accuracy of the forecast, but, on the contrary, interferes with the normal analysis of the price chart. There is no need to overload your schedule. You can get by with just a couple of indicators: some trend indicator and one oscillator. This is more than enough!
Make a trading plan before the market opens
Before you start trading, be sure to sketch out a trading plan and try to stick to it throughout trading day. Here are our recommendations.
- Look at if there are any important news and market statistics for today. You will know when to expect increased volatility in the market. The meaning of the news and data itself is not important, only the timing is important to be ready for increased activity in the market.
- Look at the main timeframes, from high to low, for the presence of reversal and trend continuation patterns and other patterns. You can automatically determine patterns, important price levels and the most likely trend direction using the program.
- Look at oscillator data to see if it shows divergences that could be signs of a reversal.
- Draw the main ones.
- After analyzing this data, decide on the direction in which you will trade, and stick to the strategy all day.
Having a trading plan will protect you from rash actions. Based on the analysis, you will know in advance what to do during the day: buy or sell. The absence of a plan will bring turmoil and rash actions to trading, which will certainly end in losses.
What deposit volume should I trade with?
To determine how much account volume to use in a trade, you need to decide where the position entry point will be and how far the stop loss will be set. Every trader knows and determines his own risks. When a stop can be set at a distance of several points, it would be foolish not to take advantage of this opportunity and not use a significant amount of capital in the transaction. You can even do it all!
In the case when stops need to be placed far from the trade entry point, it is better to reduce the volume to enter the position.
Trade Restrictions
Be sure to set yourself limits on the number of transactions per day. This will help you avoid unnecessary losses. If the market has not decided on the direction of movement after several of your calls, and knocked out a position based on a stop order, then turn off the terminal and wait for the next trading day. The market is not going anywhere, there is an opportunity to trade every day.
Avoid other people's opinions on market situations
Remember that you are the only one responsible for your trading. Only you profit or suffer losses from your actions. Don't let other people's opinions interfere with your trading. This applies to all analytics, which is full on and in chats.
Conclusion
We hope you find this information useful. Everything written here has been verified by money and experience. If you have any questions, we will be happy to answer them in the comments to this post :)
Happy trading!
Leading broker on FOREX market -
Part 1. Background
I first heard about the Forex market back in 2010. Then my older brother signed up for a trading course and told me a lot about the basics of currency exchanges, Japanese candlesticks and people who made fortunes from it. In those early years, I was not at all interested in the market, and somehow I had no thirst for easy money. And all these terms like Japanese candlesticks, margin, leverage, sounded like White noise. But my brother confidently attended classes, watched video lessons and tried to trade on a demo account, and then on a real account. At the end of the courses, the academy opened a real account for each student with $100 in it. For overclocking, so to speak. According to the brother’s stories, half of his “colleagues” lost these deposits very quickly. And, as the teachers said, this typical mistake newbie, everyone goes through this. Time will pass, and you will learn how to manage risks, and money will flow, if not like a river, then at least in a stream, enough for sausage sandwiches. Sounds tempting, doesn't it?
Time passed and my brother’s ardor somehow faded. He almost lost his 100 dollars, and, unfortunately (and as it turned out later, to great happiness), there was nothing to replenish the deposit with. And so his trading career ended. But he left the market without understanding whether he could make money there. One of his St. Petersburg friends, inspired by his brother’s stories, also started trading, but it was difficult to say whether it was successful or not, because his words were: “I seem to be earning something, but then I lose it all again” (oh how often I heard this phrase later ).
A couple of years passed, and the idea of easy money from jumps in exchange rates was crawling somewhere in the subcortex of my brain. In 2012, my friend told me that his friend was sitting at home and earning his living and mortgage on the Forex exchange. They say he opens a couple of well-thought-out transactions and lights up 500 bucks from each. Here we saw the first person actually making money on Forex. And the fire in our hearts burned. We started reading articles and watching video tutorials about what an exchange is and what trading terminals exist. Terms fell on our heads like out of a bucket - margin, leverage, indicators, orders, etc. But it was even funny, because we felt that this was the beginning of our careers as millionaires. We registered demo accounts and began to master trading.
Naturally, at first everything was unclear, some arrows, graphs and numbers. But after a couple of weeks, we got used to it and felt like fish in water. There was only one thing - even on demo accounts we had no profit. But an excuse was quickly found - with the candy wrappers of a demo account there is no risk and no fear, it’s time to switch to real money. We quickly looked through the tops of the best brokers and chose the appropriate option. And we deposited into our first accounts, as expected, $100 - the minimum deposit. Well, trading began, and our expectations were justified; with real money came fear and a sense of responsibility. At the moments of opening the first real transactions, my hands were shaking as if in a traffic police exam. But with real deposits came another factor, the most dangerous and insidious. A factor that has caused millions of people to lose everything in their lives. The factor that causes families and even lives to collapse is EXCITATION! And no matter how much I thought of myself as an objective, sensible person and not subject to excitement, I succumbed to excitement. And its destructiveness lies in one simple thought: “Now I’ll invest more in this deal and not only will I get rid of all the minuses, but I’ll also double the deposit.” This thought ruins all risk management plans, strategies and techniques. And no matter how many articles I read about how to develop a system and strictly act on it, nothing worked for me. Sooner or later the excitement took its toll. You can, of course, say that I’m so small-minded and spineless, but, unfortunately, I’m not the only one. And so far in my life I have never seen a person making money on Forex, except... a broker!
As a result, like all newcomers, we lost our first deposits. But, again, this was expected, because this is a “standard error”. And since the error is standard, it means we are moving along the beaten path to enrichment and heavenly life. We need to work on our mistakes. And to work, you need funds. So we added a second batch of money to our deposits. Well, what can you do with 100 dollars, we poured in 500 each. Well, so that we can immediately recapture those 100 and earn new ones. By the way, there were times when 500 grew to 600 and it was really nice. But then they turned into 400, 300 and melted from deal to deal. We promised ourselves that it was time to reduce trading volumes to reduce risks. One simple factor prevented us from doing this - the painfully familiar EXCITATION. After all, every time it seemed like this was the deal of my life and now I would invest everything in it, and how the market would jerk in the right direction. But he always tore in the opposite direction, taking with him the remnants of our deposit. Second deposits were approaching zero.
And then we started thinking, is it really possible to make money on the Forex market?
Part 2. How we got rich with gold
As I already said, our second deposits were coming to an end, and we decided to understand what was the reason for our troubles. We identified the reason quite quickly - the wrong trading strategy. Like all new traders, we traded haphazardly. Yes, we had some tactics, but, succumbing to the excitement, we forgot about everything and rushed after the rapidly departing schedules. The fast movements of the market drove us crazy, afraid of missing out on big profits, we rushed into transactions. This behavior is even described in many smart articles and is called “Jumping on a departing train.” And the fact that our behavior once again fit the classic definition of beginner’s mistakes only confirmed that very soon we would become seasoned pros and start earning decent money.
But the leaked amount of almost 600 dollars no longer seemed trivial to us, and we decided to slow down a little. We switched to very small transaction sizes and tried to open strictly according to the system. And, in general, something even worked out. Only the profits were completely boring. From deposit balances of about $100, we earned 1-2 two dollars per transaction, which could last more than one day. This situation upset us, because at this rate it will not be possible to return the old deposits soon.
And we decided to turn to our friend for help, the same one who, sitting at home, earns money on the stock exchange both for a mortgage and for a living. His answer was simple and clear - you are trading the wrong pairs. Ditch this Eurodollar and switch to gold trading (XAU/USD). But there was only one significant drawback in trading gold - the minimum transaction amount was $125, and you also need a little for drawdown. In general, our deposits were not suitable for gold at all, and somehow we didn’t want to put new money on them from our own wallet. However, we added a gold chart to our terminals and began to look at it regularly. The figures there were painfully beautiful, and the intensity of the traffic really inspired hope for a quick profit.
After a couple of weeks, we felt ready! It seems that the deposits have stopped melting and we have somehow begun to control ourselves. We have developed our own systems, graphs and arrows, almost like a pro. We gathered our strength and deposited another $500. Well, it’s just that 125 was needed for one deal, and it’s not a fact that it will work, and the reserve was small. And we went to trade for gold. I remember that we certainly had enough adrenaline. Opening a trade where each pip costs $1 was cool. With each market movement, the numbers in the terminal changed in a childish way. The most interesting thing is that we had positive trades, and the fact that the cost of one point was high made the profit very significant. We closed a couple of deals for +$200. Second interesting fact that gold really lends itself well to analysis. It worked especially well on strong lines. True, there was one thing - the chart approached strong lines no more than once a month, but I always wanted to trade. But we controlled ourselves, placed pending orders and waited for juicy deals.
And life would be honey if everything depended on us. After some time, we saw that gold does not always follow strong lines; sometimes it simply breaks through them and rushes to stop losses, taking away our money. Succumbing to the same EXCITATION, we rushed after the schedule, changing trades to the opposite ones. But this, as you know, is bad practice and we lost the deposits. Moreover, we merged them very, very quickly, rushing into one or another adventure. And what’s most interesting is that in all this fuss, you begin to get tired of losing and stop feeling that you are losing real money. Your own, which you recently transferred from your own wallet to the broker.
At the moment when the margin call hit our accounts, we were so exhausted that we were even generally glad that it was finally over and we didn’t have to worry anymore. We firmly decided to leave the Forex market and all these ventures for easy money. Even though we saw positive trades and even closed them. Despite the fact that we, our friend, sits at home and makes a living for himself with a couple of transactions, and we work hard at our jobs and there are no prospects for a carefree future.
Is it possible to quit Forex? Is it possible to just leave it one day and never return?
Part 3. How the trading assistant helped us drain the deposit
After a couple of months without Forex, my hands began to itch a little. The resentment from the loss faded away, and those same profitable trades and big candles on gold did not give us peace. After all, there were successful transactions, and they were opened according to our system, when all the facts were clearly planned, and entry into the transaction was carried out only if there were signals. So what then was the reason for our defeat? Why did we leave defeated? And all the forums and books unanimously repeated that the market does not forgive mistakes, that 90% leave with nothing precisely because I trade haphazardly. And only 10% of real pros actually earned their millions on the market.
And then we came across one interesting phrase: “The one who walks will master the road.” We have used this phrase more than once in a humorous version: “The road will be mastered by the one who walks, who goes to...”. One way or another, it became our motto. But really, all our troubles are just a thorny path to laurels. And only cool-headed traders who are able to learn from mistakes are able to reach the end. And off we went. But how can we learn to be cool-headed? How can you stop giving in to temptation and trade strictly according to plan?
The answer came as an inspiration - I need to write an assistant. After all, it is a cold-blooded machine that will be able to objectively assess the situation on the market without succumbing to panic and excitement. Almost all modern terminals have built-in programming languages, and we, by the way, are programmers by profession. The idea was innocent - to write an assistant that would evaluate the market based on a number of factors and tell us whether to open a deal or not. We tried coding for a week. We read the specifications, looked at the examples - everything became clear. The assistant was written quite quickly. I will not go into details of our system, but it assessed the chart at different periods and highlighted interesting points at which, in our opinion, trading began.
The assistant test began, which was very successful. Yes, there were a lot of mistakes, but right decisions was more than 70%. We worked on demo accounts for now, because our real accounts were at zero. In the process of writing the assistant, we saw another important advantage in it - it can work around the clock, it’s also a machine. Here we decided to entrust all trading to him. We added it with the function of opening a deal and started testing it. Again, almost all terminals have access to price history and are able to evaluate the effectiveness of the assistant based on history. The results of the assessment amazed us. Income from transactions amounted to up to 1000% of the deposit per month. True, this was just a story, but we tested it over a long period and the results inspired confidence. Having debugged a number of system parameters using history, we decided to launch the assistant in real time. True, it’s still on a test account.
A couple of weeks of tests showed nothing. The profit was zero, but there were no losses either. We quickly found an excuse - the market is sluggish now. The market was indeed sluggish during this period. We decided not to torment ourselves, otherwise we would suddenly miss all the action with this demo account - we replenished the deposits and launched the assistant on the real account. They set him the minimum transaction size and set him free to sail. He swam for about a month. The market behavior was completely different from history. Although all the forums and textbooks unanimously repeated Golden Rule trade: “history repeats itself.” Yes, for some reason it didn’t happen again. The robot traded, opened a bunch of deals, but we didn’t see a 1000% growth.
Probably the phrase “Third deposits were drained” is now expected. We allowed the assistant to drain only half of the deposits, then we cut his wires. There were 250 bucks left in our accounts. Meanwhile, gold was approaching a very strong line. Well, the EXCITATION took its toll and we decided to recoup all the lost money with one deal. They placed orders and began to wait. The orders, by the way, worked as expected. And we went into profit. We immediately reached $500. But they didn’t stop there; they began, as they wrote in the textbooks, “Milk the market to the last drop.” But the market milked us faster.
The third deposits were lost. But the mistakes are still the same - succumbing to excitement, we deviated from the plan. Although sometimes history simply did not repeat itself, and the market ignored all the lines and went about its business. Is the market amenable to analysis or is it influenced by random fundamental factors that disrupt all traders’ plans?
But the main question that began to interest us: “Are there people who made money on the Forex market?”
Part 4. Are there people who have made money on the Forex market?
We actually studied this question at the earliest steps, and the answer was obvious - YES! But we began to search more carefully. There are a lot of stories on the Internet about this trader and that one, here they are, these lucky ones. And, reading their stories, we saw how they started, how they made all the same beginner mistakes. There's a German grandmother who, in retirement, sat down at the terminal and made a fortune. Well, yes, it seems there are such people on the Internet. What about in life?
We turned to our old friend with a mortgage. The truth amazed us - so far he has not earned anything, but only lost 200 thousand!!! His wife pays for the mortgage, and he does part-time work, and puts everything he earns on deposit, in the hope of making up for the minus. Before this, he was simply ashamed to admit his failures, they say, they would think he had to be crazy to lose such money. That’s how it is, in general. Although, in his mind, he has not lost them, he is still in the process of understanding the market, and big profits are on the horizon.
My brother’s friend from St. Petersburg abandoned this business a couple of years ago, they say, “he earned something, but then lost it all.” It turns out that all the real people you can talk to have earned nothing. On the Internet on forums, people boast that they have been trading for years and very successfully, but in neighboring threads these same people say that they open at a minimum, because the deposit is close to zero. Strange for a millionaire.
After analyzing the entire Forex market, I came to a number of contradictions:
1) If it’s easy to make money in the market, as brokers say it is, why don’t they just trade themselves? After all, why should they collect these crumbs in the form of interest on transactions, when they themselves can spin millions there and earn millions. But brokerage companies employ hundreds of employees.
2) Why would someone who has developed their own unique trading system that brings in a stable income share it with others? And not just sharing, but also trying to conduct paid seminars for 100 rubles per participant. And some even offer to send CDs by mail for 200 rubles. This is a bit petty for a millionaire, don’t you think?
3) Why should people who have written a successful assistant that brings in 1000% per month post it online? After all, you are already a millionaire, why create competition?
4) Why does a person who considers himself a pro and has been trading successfully for many years write on the forums questions: “Well, where will the market go? What are the forecasts? After all, you have a system and you are based on your proven signals, and not on the opinions of little-known people.
After analyzing my and others' experiences, I came to the following conclusions:
1) Yes, there are people who have made money on the Forex market, and these are the same brokers who collect interest from transactions and conduct paid seminars on “how to quickly lose your deposit.” Besides, I'm sure that most of them don't open your trade at all, but just keep the money in their accounts waiting for you to drain them. And you will merge them, because all these trading systems- nonsense.
2) People who say that they make money on the Forex market are in fact ordinary slot machine players. They are simply addicted to EXCITATION and eager to recoup all their losses and hit the jackpot. It’s not for nothing that I highlighted this word in all articles. This is the same addiction as casinos and other long-proven addictions.
3) All these win-win systems are aimed only at ensuring that you quickly lose your deposit and, in the hope of returning what you lost, bring more and more money to the broker.
I described my experience only so that people who are going to or are already trading on the Forex market will analyze my words and try to understand that it is impossible to make money there. You won't be able to tame the market. The market is not subject to analysis or systems. Most likely, you will simply lose your deposit, and then the next and the next. Leave these ideas before it's too late. You will not be able to return money already spent.
Stop! Forex is a soulless machine that absorbs your earned money.