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Forex trading is an alluring activity. It attracts hundreds of traders every year.
This is because of the potential income one is likely to make in the industry. The forex market daily trades are worth about $5 trillion. There isn’t an industry in the world that can be compared to the forex industry.
There are many ways to join the market and make a portion of the money being made by the big money companies.
The only thing you have to guard against is greed as you can lose your whole investment easily.
Here are the steps to follow to start forex trading.
Start Learning
Like with every other profession, you need to learn forex trading before you start trading. There are many diverse aspects of the market that you need to know.
You need to learn as much as you can on the best trading strategies that you can adopt to make consistent profits and protect your capital.
Learn the basics of forex trading properly to learn so that when you start trading you can go from beginner to advanced trader quickly.
Practice on a Demo Account
After you have taken your lessons on forex trading, practice trading.
Download Metatrader4 and open a demo account. A demo account is a forex trading account loaded with virtual money to help novice traders practice how to trade.
With the demo account, you can access the forex market in real time. With the virtual money loaded in the account, you can set up trades, take a position and take a profit or loss on your trades.
From the demo account, you will learn how to trade on the MT4 trading platform. The demo is a replica of the live trading platform except for the virtual money.
It is still important even once you have started actual trading to simulate your trades before you take up a position.
Get a Live Trading Account
After spending some time on the demo account, it is time to get a live trading account.
Through your broker, you will get a link to help you download a live MT4 trading account. Having worked with the demo account, you already know how to work the live account. This means that you won’t have to start learning how to use the account.
The only aspect of the live account that you need to learn is how to add funds to it. Your broker will guide you on how to do this and the acceptable minimum account to start trading.
With your trading now live, remember everything you have learnt in the last steps. Choose a currency pair to trade and also carry out proper analysis and research before you take a trading position. Also, make sure to protect your capital by setting up take profit and stop loss levels.
With a live account, you can also invest in other categories such as stocks and commodities.
Treat Forex Trading as a Business
When you start trading you must look after your money. Treat forex trading as a business.
Manage and protect your capital properly. Avoid high levels of leverage as this could lead you to huge losses and cause you to go out of business.
Take responsibility for all actions that you take while trading. Not just the beneficial actions, but also those that may lead to losses. This is the only way to learn and grow as a trader.
Manage your emotions and make your trading decisions based on the available data at all times. Poor emotional management will keep you stuck in a loss making position.
Conclusion
Finally, make trading your main job. As you gain more experience as a trader, move from a part time trader to a full time trader. Forex trading calls for continuous learning and a growth mindset to succeed.
Persistent trading and continuous learning makes you a better forex trader who makes consistent profits in their trades.
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