By: Sara Patterson
If there is one thing I learned in my Forex experience, it is that I have a whole lot more to learn. The potential that Forex brings to the table is unprecedented in the financial world. I mean, where else can you interact with the world’s most influential financial institutions while trading the leading currencies that make the financial markets move? Where else can you open transactions worth millions of dollars with as little as a few thousand in your account?
However, just like everything in life, the coin has two sides. Forex is also the most volatile of the markets with currency rates almost never sitting still. While this can mean more profits, it can, and very often does, also means great danger. In addition, the very thing that attracts so many to Forex, the leverage, more often than not becomes the very thing that brings on failure.
If at First You Don't Succeed...
There really is only one way to avoid hazardous Forex mistakes, and that is preparation. Preparing yourself for Forex trading is something you must do, and there are many ways to do it. The two primary methods to ensure you are ready to partake in this trading arena are education and practice.
I think educating one’s self as well as practicing are two things you should do before entering any new challenge, but they are magnified when we are talking about risking money in such a risky endeavor.
So how do you learn and how do you practice Forex? The answer in two words? Web and Demo! Learn Forex by reading, reading, reading, and then when you are done, read some more. Google the words Forex, Forex learning, Forex Courses, and all other words pertaining to learning Forex. Read the first three pages of results, then Google some more. You will learn very fast that you cannot read fast enough. The Web is a never-ending entity, and Forex is a very common and prevalent topic on the Web.
Practice Makes Perfect
After you feel like you are getting a hang of Forex and you are familiar with terms like MT4, Technical Analysis, Forex Oscillators, Forex strategy, Stop Losses, and Take Profits (to just name a few), open a demo account.
Find a solid Forex broker you would consider trading with and open a demo account. Trade, trade, then trade some more. Spend your days and nights trading. Pay close attention to the results and remember, only once you see steady profits should you even consider trading real money.
Just remember that a demo account is not a real account. It is not real in terms of the pressure you feel, it is not real in terms of your emotions, and sometimes, believe it or not, it is not real in terms of the actual trading experience. Some brokers use different servers for their demo in order to lure you into a real account based on the fake results you will see in their demo trading.
Be careful. Learn yourself and get to know your strategy. Then and only then, after doing all this for at least a few weeks if not months, should you open a real Forex trading account.