I'm fairly new to Forex. I've spent a great deal of time understanding Forex and I'm still immersing myself in as much information as I can find. I started a 100k demo account to practice strategies and feel as though I have a pretty good system. I trade on the daily chart and use a series of indicators and monitor shorter time frames to make sure things don't go awry. At the time I wasn't too concerned with leverage/margins. I'm currently practicing on a demo account of $2k taking into account leverage. I'm trading no more than 2 mini lots and 3-5 micro lots at a time such that I'm leveraging no more than $1k of "my money" and a $1k buffer. I'm pretending to use "max leverage." submitted by
My plan: Try to build $1k of profits. Reinvest profit to build to $2k. Turn $2k to $5k, $5k to $10k. Eventually get to a point where I can turn it into a sustainable income. Then transfer to a live account. Am I living in unicorn land with illusions of grandeur? I'm concerned with relying on using max leverage. Do people make sustainable incomes on Forex trading?
I'm in a trade of GBPJPY short at 10,000 units. Current profit is at $188.00. The trade value is $6509. According to IG brokerage the GBPJPY margin is 5%. Using max leverage I'm only using $325 of "my money." If I chose to trade 100,000 units, given I have the funds for leverage, I would have $1880.00 of profit. That seems like sustainable income territory to me.
Please guide me Forex community!
Almost every day people come to this subreddit asking the same basic questions over and over again. I've put this guide together to point you in the right direction and help you get started on your forex journey.
A quick background on me before you ask: My name is Bob, I'm based out of western Canada. I started my forex journey back in January 2018 and am still learning. However I am trading live, not on demo accounts. I also code my own EA's. I not certified, licensed, insured, or even remotely qualified as a professional in the finance industry. Nothing I say constitutes financial advice.
Take what I'm saying with a grain of salt, but everything I've outlined below is a synopsis of some tough lessons I've learned over the last year of being in this business.
LET'S GET SOME UNPLEASANTNESS OUT OF THE WAY
I'm going to call you stupid. I'm also going to call you dumb. I'm going to call you many other things. I do this because odds are, you are stupid, foolish,and just asking to have your money taken away. Welcome to the 95% of retail traders. Perhaps uneducated or uninformed are better phrases, but I've never been a big proponent of being politically correct.
Want to get out of the 95% and join the 5% of us who actually make money doing this? Put your grown up pants on, buck up, and don't give me any of this pc "This is hurting my feelings so I'm not going to listen to you" bullshit that the world has been moving towards.
Let's rip the bandage off quickly on this point - the world does not give a fuck about you
. At one point maybe it did, it was this amazing vision nicknamed the American Dream. It died an agonizing, horrible death at the hand of capitalists and entrepreneurs. The world today revolves around money. Your money, my money, everybody's money. People want to take your money to add it to theirs. They don't give a fuck if it forces you out on the street and your family has to live in cardboard box. The world just stopped caring in general. It sucks, but it's the way the world works now. Welcome to the new world order. It's called Capitalism.
And here comes the next hard truth that you will need to accept - Forex is a cruel bitch of a mistress. She will hurt you. She will torment you. She will give you nightmares. She will keep you awake at night. And then she will tease you with a glimmer of hope to lure you into a false sense of security before she then guts you like a fish and shows you what your insides look like.
This statement applies to all trading markets - they are cruel, ruthless, and not for the weak minded.
The sooner you accept these truths, the sooner you will become profitable. Don't accept it? That's fine. Don't bother reading any further. If I've offended you I don't give a fuck. You can run back home and hide under your bed. The world doesn't care and neither do I.
For what it's worth - I am not normally an major condescending asshole like the above paragraphs would suggest. In fact, if you look through my posts on this subreddit you will see I am actually quite helpful most of the time to many people who come here. But I need you to really understand that Forex is not for most people
. It will make you cry. And if the markets themselves don't do it, the people in the markets will.
LESSON 1 - LEARN THE BASICS
Save yourself and everybody here a bunch of time - learn the basics of forex. You can learn the basics for free - BabyPips has one of the best free courses online which explains what exactly forex is, how it works, different strategies and methods of how to approach trading, and many other amazing topics.
You can access the BabyPips course by clicking this link: https://www.babypips.com/learn/forex
Do EVERY course in the School of Pipsology. It's free, it's comprehensive, and it will save you from a lot of trouble. It also has the added benefit of preventing you from looking foolish and uneducated when you come here asking for help if you already know this stuff.
If you still have questions about how forex works, please see the FREE RESOURCES links on the /Forex
FAQ which can be found here: https://www.reddit.com/Forex/wiki/index
Answer these questions truthfully to yourself:
-What is the difference between a market order, a stop order, and a limit order?
-How do you draw a support/resistance line? (Demonstrate it to yourself)
-What is the difference between MACD, RSI, and Stochastic indicators?
-What is fundamental analysis and how does it differ from technical analysis and price action trading?
-True or False: It's better to have a broker who gives you 500:1 margin instead of 50:1 margin. Be able to justify your reasoning.
If you don't know to answer to any of these questions, then you aren't ready to move on. Go back to the School of Pipsology linked above and do it all again.
If you can answer these questions without having to refer to any kind of reference then congratulations, you are ready to move past being a forex newbie and are ready to dive into the wonderful world of currency trading! Move onto Lesson 2 below.
LESSON 2 - RANDOM STRANGERS ARE NOT GOING TO HELP YOU GET RICH IN FOREX
This may come as a bit of a shock to you, but that random stranger on instagram who is posting about how he is killing it on forex is not trying to insprire you to greatness. He's also not trying to help you. He's also not trying to teach you how to attain financial freedom.
99.99999% of people posting about wanting to help you become rich in forex are LYING TO YOU
Why would such nice, polite people do such a thing? Because THEY ARE TRYING TO PROFIT FROM YOUR STUPIDITY
Plain and simple. Here's just a few ways these "experts" and "gurus" profit from you:
- Referral Links - If they require you to click a specific link to signup for something, it means they are an affiliate. They get a commission from whatever the third party is that they are sending you to. I don't care if it's a brokerage, training program, hell even an Amazon link to a book - if they insist you have to click their super exclusive, can't-get-this-deal-any-other-way-but-clicking-my-link type bullshit, it's an affiliate link. There is nothing inherently wrong with affiliate programs, but you are literally generating money for some stranger because they convinced you to buy something. Some brokers such as ICMarkets have affiliate programs that payout a percentage of the commission you generate - this is a really clever system - whether you profit or blow your entire account, the person who referred you to the broker makes a profit off you. Clever eh?
- Signal Services, Education & Training Programs, Courses - If somebody is telling you they are making a killing with a signal service and are trying to convince you to join it, I guarantee they are getting a piece of your monthly fee. And better still, these signal services often work...for about a week. Just long enough to suck a bunch of poor fools into it. You see people making money, you want in so you agree to pay the $200+/month subscription fee. You follow the signals and it looks like it's making money for a few days or weeks. Then it turns sideways, you start losing money hand over fist. Pretty soon you have lost most of your trading account because you blindly followed a signal service. And better still - when you go screaming at the person running the signal service they will be very quick to point you to their No Refunds policy. To add insult to injury, the buttfucker that referred you to the signal service in the past will likely listen to you getting mad, and then come back with something like "Sorry it didn't work out, but I just joined this other amazing service and it's working great, you should come join it to earn your money back. Here's my link..." You get the point here right?
- Multi-Level Marketing (MLMs) - These people are scum. They are going to offer you training and education, signals, access to forex experts and gurus, and all kinds of other shit with the promise that you will live the dream and become financially free. They are also loading you into a pyrmaid scheme where you will be hounded to recruit other people and make money off them just like you got roped into it. A really prime example here is iMarkets Live (or IML for short). Don't touch this shit with a 10 foot pole. I don't care what they are claiming, you will lose everything using them.
- Fund Managers - These people make my skin crawl. It's a classic scam and it works like this - somebody will post online about how much money they are making trading forex/commodities/stocks/whatever. Most of the time they won't explicitly post they are offering a trading service, rather they just put the message out there and wait for the ignorant masses (that's you) to contact them. They will charm you. They will lie to you. They will promise you the moon if you simply wire them some money or give them API access to your trading account. Care to guess what happens next? If you send a wire transfer (or Western Union...hell any kind of payment to them) they will vanish. Happens usually after they take a bunch of suckers for the ride. You sent them $2,000 and so do 9 other suckers. They just made $20,000 and are gone. With API access to your account, you will find your account gets blown super fast or worse - possibly leaving you open to persecution by the broker you are using.
These are just a few examples. The reality is that very few people make it big in forex or any kind of trading. If somebody is trying to sell you the dream, they are essentially a magician - making you look the other way while they snatch your wallet and clean you out.
Additionally, on the topic of fund managers - legitimate fund managers will be certified, licensed, and insured
. Ask them for proof of those 3 things. What they typically look like are:
- Certified - This varies from country to country, in the US it's FINRA (http://www.finra.org). They need to have their Series 7 certification minimum. You can make the case that other FINRA certifications are acceptable in lieu of Series 7, but the 7 is the gold standard.
- Licensed - They need to have a valid business license issued by the government. It must clearly state they are an investment company, preferrably a hedge fund because they have some super strict requirements to operate (and often require $25,000+ in fees just to get their business license, so you know they at least have some skin in the game).
- Insured - They need to be backed by an insurance company. I'm not talking general insurance for shit like their office burning down. I'm talking about a government-implemented protection insurance program - in the US I believe that is issued by the Securities Investment Protection Corporation (https://www.sipc.org/).
If you are talking to a fund manager and they are insisting they have all of these, get a copy of their verification documents and lookup their licenses on the directories of the issuers to verify they are valid
. If they are, then at least you are talking to somebody who seems to have their shit together and is doing investment management and trading as a professional and you are at least partially protected when the shit hits the fan.
LESSON 3 - UNDERSTAND YOUR RISK
Many people jump into Forex, drop $2000 into a broker account and start trading 1 lot orders because they signed up with a broker thinking they will get rich because they were given 500:1 margin and can risk it all on each trade. Worst-case scenario you lose your account, best case scenario you become a millionaire very quickly. Seems like a pretty good gamble right? You are dead wrong.
As a new trader, you should never risk more than 1% of your account balance on a trade. If you have some experience and are confident and doing well, then it's perfectly natural to risk 2-3% of your account per trade. Anybody who risks more than 4-5% of their account on a single trade deserves to blow their account. At that point you aren't trading, you are gambling. Don't pretend you are a trader when really you are just putting everything on red and hoping the roulette ball lands in the right spot.
It's stupid and reckless and going to screw you very quickly.
Let's do some math here:
You put $2,000 into your trading account. Risking 1%
means you are willing to lose $20 per trade. That means you are going to be trading micro lots, or 0.01 lots most likely ($0.10/pip). At that level you can have a trade stop loss at -200 pips and only lose $20. It's the best starting point for anybody. Additionally, if you SL 20 trades in a row you are only down $200 (or 10% of your account) which isn't that difficult to recover from. Risking 3%
means you are willing to lose $60 per trade. You could do mini lots at this point, which is 0.1 lots (or $1/pip). Let's say you SL on 20 trades in a row. You've just lost $1,200 or 60% of your account. Even veteran traders will go through periods of repeat SL'ing, you are not a special snowflake and are not immune to periods of major drawdown. Risking 5%
means you are willing to lose $100 per trade. SL 20 trades in a row, your account is blown. As Red Foreman would call it - Good job dumbass.
Never risk more than 1% of your account on any trade until you can show that you are either consistently breaking even or making a profit. By consistently, I mean 200 trades minimum. You do 200 trades over a period of time and either break-even or make a profit, then you should be alright to increase your risk.
Unfortunately, this is where many retail traders get greedy and blow it. They will do 10 trades and hit their profit target on 9 of them. They will start seeing huge piles of money in their future and get greedy. They will start taking more risk on their trades than their account can handle.
200 trades of break-even or profitable performance risking 1% per trade. Don't even think about increasing your risk tolerance until you do it. When you get to this point, increase you risk to 2%. Do 1,000 trades at this level and show break-even or profit.
If you blow your account, go back down to 1% until you can figure out what the hell you did differently or wrong, fix your strategy, and try again.
Once you clear 1,000 trades at 2%, it's really up to you if you want to increase your risk. I don't recommend it. Even 2% is bordering on gambling to be honest.
LESSON 4 - THE 500 PIP DRAWDOWN RULE
This is a rule I created for myself and it's a great way to help protect your account from blowing.
Sometimes the market goes insane. Like really insane. Insane to the point that your broker can't keep up and they can't hold your orders to the SL and TP levels you specified. They will try, but during a flash crash like we had at the start of January 2019 the rules can sometimes go flying out the window on account of the trading servers being unable to keep up with all the shit that's hitting the fan.
Because of this I live by a rule I call the 500 Pip Drawdown Rule and it's really quite simple - Have enough funds in your account to cover a 500 pip drawdown on your largest open trade
. I don't care if you set a SL of -50 pips. During a flash crash that shit sometimes just breaks.
So let's use an example - you open a 0.1 lot short order on USDCAD and set the SL to 50 pips (so you'd only lose $50 if you hit stoploss). An hour later Trump makes some absurd announcement which causes a massive fundamental event on the market. A flash crash happens and over the course of the next few minutes USDCAD spikes up 500 pips, your broker is struggling to keep shit under control and your order slips through the cracks. By the time your broker is able to clear the backlog of orders and activity, your order closes out at 500 pips in the red. You just lost $500 when you intended initially to only risk $50.
It gets kinda scary if you are dealing with whole lot orders. A single order with a 500 pip drawdown is $5,000 gone in an instant. That will decimate many trader accounts.
Remember my statements above about Forex being a cruel bitch of a mistress? I wasn't kidding.
Granted - the above scenario is very rare to actually happen. But glitches to happen from time to time. Broker servers go offline. Weird shit happens which sets off a fundamental shift. Lots of stuff can break your account very quickly if you aren't using proper risk management.
LESSON 5 - UNDERSTAND DIFFERENT TRADING METHODOLOGIES
Generally speaking, there are 3 trading methodologies that traders employ. It's important to figure out what method you intend to use before asking for help. Each has their pros and cons, and you can combine them in a somewhat hybrid methodology but that introduces challenges as well.
In a nutshell:
- Price Action Trading (Sometimes called Naked Trading) is very effective at identifying when trends will start and finish. This gives you the advantage of staying ahead of the market and predicting when a change in trend direction will occur. It has the disadvantage of being really easy to screw it up if you don't plot your support and resistance lines properly and interpret the chart wrong. Because you can identify a change in trend direction, you'll generally make more profit on a new trend than a technical strategy will.
- Technical Analytics (or TA) uses math and statistics to try and identify where the market is headed or confirm/reject whether a trend is happening. It has the advantage of being very math and stat driven which is hard to refute the numbers, but it has the disadvantage of being late to the party when it comes to identifying trends (hence why people call TA a lagging strategy). When people fail using TA, it's not because of the math - it's because you misinterpreted what the math is telling you.
- Fundamental Analysis (or FA) uses news and macro scale events to predict what is going on. A really good example right now is Brexit, what a clusterfuck that is. Every time some major brexit news breaks it causes all sorts of choas in almost every currency pair. Fundamental trading has the highest potential profitability per trade but it also has the highest potential drawdown per trade.
Now you may be thinking that you want to be a a price action trader - you should still learn the principles and concepts behind TA and FA. Same if you are planning to be a technical trader - you should learn about price action and fundamental analysis. More knowledge is better, always.
With regards to technical analysis, you need to really understand what the different indicators are tell you. It's very easy to misinterpret what an indicator is telling you, which causes you to make a bad trade and lose money. It's also important to understand that every indicator can be tuned to your personal preferences.
You might find, for example, that using Bollinger Bands with the normal 20 period SMA close, 2 standard deviation is not effective for how you look at the chart, but changing that to say a 20 period EMA average price, 1 standard deviation bollinger band indicator could give you significantly more insight.
LESSON 6 - TIMEFRAMES MATTER
Understanding the differences in which timeframes you trade on will make or break your chosen strategy. Some strategies work really well on Daily timeframes (i.e. Ichimoku) but they fall flat on their face if you use them on 1H timeframes, for example.
There is no right or wrong answer on what timeframe is best to trade on
. Generally speaking however, there are 2 things to consider:
- Speed - If you are scalping (trading on the really fast candles like 1M, 5M, 15M, etc) odds are your trades are very short lived. Maybe 10 minutes to an hour tops. For the most part, scalping strategies will produce little profit per trade but make up for it in the sheer volume of trades. Whereas swing trading may only make a few trades but each one could be worth a significant amount of money.
- Spread (the fee you pay to the broker when you trade) - If you are a scalper, the spread is your worst enemy because you have to overcome it very fast to make a profit on your order. Whereas swing trading the spread hardly impacts you at all.
If you are a total newbie to forex, I suggest you don't trade on anything shorter than the 1H timeframe when you are first learning
. Trading on higher timeframes tends to be much more forgiving and profitable per trade. Scalping is a delicate art and requires finesse and can be very challenging when you are first starting out.
LESSON 7 - AUTOBOTS...ROLL OUT!
Yeah...I'm a geek and grew up with the Transformers franchise decades before Michael Bay came along. Deal with it.
Forex bots are called EA's (Expert Advisors). They can be wonderous and devastating at the same time. /Forex
is not really the best place to get help with them. That is what /algotrading
is useful for. However some of us that lurk on /Forex
code EA's and will try to assist when we can.
Anybody can learn to code an EA. But just like how 95% of retail traders fail, I would estimate the same is true for forex bots. Either the strategy doesn't work, the code is buggy, or many other reasons can cause EA's to fail. Because EA's can often times run up hundreds of orders in a very quick period of time, it's critical that you test them repeatedly before letting them lose on a live trading account so they don't blow your account to pieces
. You have been warned.
If you want to learn how to code an EA, I suggest you start with MQL. It's a programming language which can be directly interpretted by Meta Trader. The Meta Trader terminal client even gives you a built in IDE for coding EA's in MQL. The downside is it can be buggy and glitchy and caused many frustrating hours of work to figure out what is wrong.
If you don't want to learn MQL, you can code an EA up in just about any programming language. Python is really popular for forex bots for some reason. But that doesn't mean you couldn't do it in something like C++ or Java or hell even something more unusual like JQuery if you really wanted.
I'm not going to get into the finer details of how to code EA's, there are some amazing guides out there. Just be careful with them. They can be your best friend and at the same time also your worst enemy when it comes to forex.
One final note on EA's - don't buy them. Ever.
Let me put this into perspective - I create an EA which is literally producing money for me automatically 24/5. If it really is a good EA which is profitable, there is no way in hell I'm selling it. I'm keeping it to myself to make a fortune off of. EA's that are for sale will not work, will blow your account, and the developer who coded it will tell you that's too darn bad but no refunds. Don't ever buy an EA from anybody.
LESSON 8 - BRING ON THE HATERS
You are going to find that this subreddit is frequented by trolls. Some of them will get really nasty. Some of them will threaten you. Some of them will just make you miserable. It's the price you pay for admission to the /Forex
If you can't handle it, then I suggest you don't post here. Find a more newbie-friendly site. It sucks, but it's reality.
We often refer to trolls on this subreddit as shitcunts. That's your word of the day. Learn it, love it. Shitcunts.
YOU MADE IT, WELCOME TO FOREX!
If you've made it through all of the above and aren't cringing or getting scared, then welcome aboard the forex train! You will fit in nicely here. Ask your questions and the non-shitcunts of our little corner of reddit will try to help you.
Assuming this post doesn't get nuked and I don't get banned for it, I'll add more lessons to this post over time. Lessons I intend to add in the future:
- Demo Trading
- Why you will blow your first account and what to do when it happens
- Trading Psychology (this will be a beefy one and will take a while to put together)
- Exotics vs Majors and which you should focus on as a newbie (aka how to blow your account in a single trade with exotics)
- Which Broker Should You Use? (This is covered in pretty good detail on the FAQ already - https://www.reddit.com/Forex/wiki/index - so I may not bother)
- Hedging (there isn't really a good guide written on this anywhere)
- Doubling Your Risk to Save Your Ass or Lose a Shit Ton (aka Martingale & Anti-Martingale)
- Risk On/Off
- Forex Calendars
- Currency Strength / Heat Maps
- Margin Calls (What are they and why are you getting them?)
If there is something else you feel should be included please drop a comment and I'll add it to the above list of pending topics.
We created this website to bring together all the tools and services you’ll need to start trading for real. If you want to start taking advantage of the markets now, without having to become an expert, our free trading signal. Whatever you’re looking for, you’ll find it with us.
Here you’ll learn the basic terminology to be a successful Forex trader. To begin learning Forex, you’ll need to have a good grasp on the basic definitions, rules and terms used by professional traders. At first, this can sound daunting but after we spell out the fundamentals, it will become clearer and you’ll be on your way to becoming a Forex trader. We will cover terms, such as; base currency, the quote currency, micro lots, mini lots, standard lots, long position, short position, pips, spread, margin and many more.
Someone who is using more than 10% of the whole equity into a trading session is probably not having a good money management strategy. Because you should always trade safe and also because the market may turn back on you and you would find yourself in a big margin problem. With good risk management, having 10% of your account invested can bring consistent returns with no problems.
Profit Rate :
Some traders can’t make 10% per year. Others can safely and consistently make 30% per month and they are not afraid to show their verified performance as a solid proof of what they offer. While taking into consideration a proper risk and money management, you should never aim to make millions in one week with a small account because that would probably mean hitting margin call. Just remember: a good strategy and analysis will always bring profits. And if at the end of the month you have only 1% profit, that means you don’t have -1% loss.
Choosing the Best Forex Broker :
In order to start trading Forex, you will need to find the right online Forex broker for you with the cash rebate program. It’s important to find the right Forex broker for your trading needs according to several important criteria, such as security, customer service, trading platform, transaction costs, live quotes and more. While reading our guide on how to choose the best FOREX BROKERS.
Forex for free :
Most Forex brokers offer many free options, services, tips and information to help you trade better. Real-time charts and news, help guides, and blogs help you understand and learn about the market in real time. There are also many “demo” accounts to try the market before putting in real money.
Why Trade Forex?
The Forex market is fast becoming the most attractive and popular market in the world. The traditional stock is no longer relevant and traders are moving fast into the Forex. We collected here a few reasons to show you why this is happening and what advantages the Forex market has to make is so popular.
We choose to focus on a few very important advantages of the Forex trading and the reasons that people choose this market:
forex is the largest financial market in the world. The daily volume of the Forex market is huge over $3 trillion per day. This makes the stability of the market very good compared to stock trading. The price in the Forex market is exactly what you see is what you get and you can follow it very easily.
Forex trading simplifies everything, there’s no clearing fees, no exchange fees, no government fees, no brokerage fees, no middlemen. The elimination of the middlemen gets the traders closer to the actual trade and makes the traders responsible for their pricing. The brokers are usually paid through a service called “bid-ask spread”. The Forex market is open 24 hours a day. Opening on Monday morning (in Australia) and closing in the afternoon (in New York). This is great for traders that can trade all day long or in parts. You can choose the times that are convenient for your trading, day-night, when you eat or when you sleep, whenever you want.
In Forex trading you can minimize the risk by depositing a small amount that will control a larger contract value. This is controlled by leverage and can make you profitable in the Forex market. If a broker gives 50 to 1 leverage it means that with $50 deposit you can buy or sell with $2500. If you put $500, you can trade with $25,000. All this needs to be done with great risk management because high leverage can easily lead to great loss, as well as great profit.
The Forex market is huge and therefore also very liquid. This means that on every buys or sell that you make, there will be someone who will take the other side of the trade. You will never be grounded because there’s no one on the other side.
To get started you would think that you need a lot of money. The reality is that online Forex brokers have “mini” and “micro” options and some of them have a minimum of only $25. This is great for Forex beginners because it makes the trading starting point easier. I’m not saying that you need to start with the minimum, but being cautious is never bad and starting small is good for the average trader. main trading company
Forex the best trading market :
You can easily predict the movements in the Forex market you have many repetitive patterns and it’s fairly easy to learn, recognize and analyze these movements. The prices tend to go up or down and return to the average. They stay for quite a long time up or down and this stability makes the Forex market a much easier market to follow. This gives the traders a huge advantage in controlling their trades much better than the disorder.
Risk Warning :
We always suggest our clients to carefully consider their investment objectives, level of experience, and risk appetite. try to money management with every trade.
Trading foreign exchange on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. FOREX IN WORLD takes no responsibility for loss incurred as a result of our trading signals. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience and risk appetite.
The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any doubts. FOREX TRADING IN INDIA:
Forex means currency pair trading. Indian citizens can trade only currencies that have a pairing with INR. It is legal to trade with Indian Brokers providing access to Indian Exchanges(NSE, BSE, MCX-SX) providing access to Currency Derivatives. Since 2008, RBI and SEBI have permitted trading in currency derivatives. The currency pairs available for trading are USD-INR, EUR-INR, JPY-INR and GBP-INR.
Hey everyone. A while back I made the decision to moderate this subreddit because I was once in your shoes. I honestly did not know where to begin. I would type in “daytrading” in google and come up with so many companies trying to sell me the dream. “Make $$$ while you sleep!” “Look at how much I made today!!” etc. I wanted to make this post to first give new people a place where to start and to even offer some resources that can get you started in the right direction. If I have anything else to add I will add it here.
- Open up a papertrading account with Think or Swim. It is free and you can get live data just by requesting it from support. All you have to do is ask them to add live data to your papertrading account. Do not pay monthly for any papertrading account. There are a lot of free videos out there that can help you get started with Think or Swim. The program looks complicated at first but it is very powerful. I spent a few days with the program and at the end of the week I was fairly comfortable with understanding where everything was. I have never had a 60-day limit with my papertrading account by the way. https://www.thinkorswim.com/t/pm-registration.html Start here and start taking trades! It is all fake money and will give you some insight into how the program works as well as how the markets move.
One other tip for setting up your papertrading account is to only set it up with a reasonable amount of money. I know a lot of papertrading accounts give you 100k right off the bat but realistically, how many of us are going to have that much money to start out with? Set it to something more reasonable like 10-20k if you are trading forex (or even less if all you have is 1-5k to trade with) or 25k+ if you are going to daytrade stocks only because the regulations require you to have at least 25k in your account at all times to daytrade (In this case, I would probably give yourself 30k just to be safe).
If you are looking for a stock screener, ThinkorSwim has a pretty good one. A personal favorite of mine is www.FINVIZ.com
which has an awesome screener for finding different chart patterns and conditions (such as prices crossing above 20 bar EMA, trending up, etc)
Think or Swim has stocks, forex, futures, and options. Options are an entirely different beast all together but stocks, forex, and futures are all "yes-no" type of trading while options give you a little more leeway with your mistakes. If you are interested in learning about options, message me and I can help guide you with the right direction and best resources I used to learn options.
EDIT: Due to the amount of PM's I was getting, I have decided to post the options course I started with here https://www.udemy.com/learn-options-trading-courses/
You shouldn't pay more than 10 bucks for it as Udemy does a ton of sales throughout the year. You can also just do a "Udemy coupon" search on google and see what you pull up. Its about 10 hours worth of content and in my opinion it is worth every penny if you are wanting to learn more about options. There are a ton of other great classes on Udemy as well for learning just about anything. Just make sure to read the reviews!
Stocks is kind of the well known market for new comers but I would argue that Forex can also just as easily be traded by a newcomer. Also the benefit of trading Forex is that there is no commission off the bat. Most brokers will charge what is called a spread of some number of pips that you are essentially paying back.
Futures trade in ticks and each tick nets you a gain of some amount or a loss of some amount so I do not suggest any new person to jump into futures until you understand the way markets work. Futures charge commission on each contract you buy or sell. It can be sort of related to Forex since a tick and a pip are essentially the same.
The huge benefit to trading Futures and Forex is that there is NO pattern day trading rule. This means you can buy and sell as many times as you want without being flagged for not having 25k in your account.
- Tradimo is a great resource for getting your feet wet with technical analysis. It is free and shows you the ropes with how you can start looking at prices and charts: https://learn.tradimo.com/courses
- If there is ever a company you want to pay to help you learn, please do your research first. Type in the company’s name along with “review” at the end of your search and make your educated decision off of that. A lot of these companies have amazing advertising but will never teach you the right way to trade. A lot of them are scams too. I read that there was one trading system which the guy had the secrets of the “code of trading” and only he knew the code but would sell it to you for hundreds of dollars. So many people come into trading with high expectations that if I just pay this company to teach me, I can be like them when in reality that may never happen. Always look at their testimonials with a grain of salt. Read the reviews just like you would on amazon for buying a product. I also like to type in the company's name and add "scam" at the end to see if I get any hits on that. Read the good reviews but also the bad to understand the bigger picture here. Very few will actually teach you how to trade. Also, Reddit is a great place to read up on things like this too. Just add "Reddit" at the end of your search and read up on other users reviews.
Investimonials is also a good place to use as well (but do not use it as your only review source!!! Fake reviews are everywhere) http://www.investimonials.com
So before you drop that 1-2k on a course, make sure you do your homework. Don't be fooled by smooth advertising.
- A high probability indicator or a holy grail strategy is not out there. If it was, everyone would be using it and making money. And if there does happen to be one, do you really think anyone will want to share it? The only way to get good at trading is to be able to read the charts and read where prices are going. This is through support and resistance and understanding channels. I cannot recommend Mack’s price action YouTube channel enough. https://www.youtube.com/usePATsTrading I am a firm believer that price action is the basis for understanding price movement. Reading an indicator may help but you should not rely on solely indicators to guide you with trading as they may give you a signal to buy when you are at a major resistance level or sell when you are at a major support, both of which could burn you.
- My only other advice is to look into markets that let you maximize profits. For some, it is not possible to buy 1000 shares of Apple. While trading low priced stocks lets you buy hundreds and maybe even thousands of shares at once, those stocks are too unpredictable because they can be influenced by individuals who do what is called a "pump and dump" schemes. Plus they can be difficult to read as far as what they are going to be doing next (going up or going down). My recommendation (and it is only my recommendation so only use this as guidance to make your own decision) would be to look into trading forex if you do not have a lot to start out with as some brokers (like FXCM) allow you to buy "micro" lots which let you invest as little as 100 dollars in some cases and have a much better chance of working in your favor due to the amount of people trading the same instrument. Note: There are some discussions about forex market makers adjusting the markets so you get stopped out prematurely. While I have not experienced this, it could theoretically happen? So if you do decide to trade Forex make sure you pick your broker carefully and again read the reviews!
EDIT: I have read that what I mentioned above about Forex is outdated and the brokers are under stricter regulations. Do your own investigation and do not let what I said steer you away from trading forex if you really want to. The big Forex brokers you are able to open an account with in the US are FXCM, Oanda, and Forex.com. You have a lot more options if you are in another country.
EDIT 2: Well it looks like FXCM may get banned from having clients in the US. Apparently they took some trades against their clients to profit on their end and have been using clients accounts to fund their extra expenses. Tread on your own risk.
- Above all, do not invest money that you are not willing to lose. I cannot emphasize this enough. Work on a simulator until you feel that your strategy works. This means putting in the time to sit down and analyze every trade you took which worked as well as the ones that didn't work. You need to go back over your mistakes and review why your trade did not work the way you thought it would. Was it because you bought at a high and sold at a low? Was it because you bought at a major resistance level thinking the stock would still go up? Was it because you were impulsive and entered in too early? Was it because you were too slow and entered in too late? This is the most important part about learning how to trade. Putting in the time and work to analyze what you did right and what you did wrong. You will never get better if you do not do this.
- Consider subscribing to a free daily financial newsletter such as The Morning Brew. It’s a free subscription that is delivered Monday through Friday to your email before the markets open around 5-6 am central time. It summarizes the big financial topics of the morning in short easy to read sections that you can read over a cup of brew.
I wouldn’t say this is essential for daytrading but it’s nice to read if you are wanting to stay up to date on the financial markets as they will write about companies and stocks to look out for. It’s also not spammy or filled with ads though there are one or two that are listed as “sponsored”. They don’t typically put out a weekend read but instead send it M-F. https://www.morningbrew.com/?kid=08944ba0
I want to make this subreddit not only as a resource for newcomers but also for those who wish to improve their skills with learning how to day trade. I do not want this subreddit to become spam and companies trying to sell dreams. We all need to keep a realistic vision on what learning the market entails because this is a journey. No one becomes a doctor in a day or even a week and you should expect the same becoming a trader. Making consistent money in the markets can be very challenging and most wont ever make it, but it can be very satisfying once things start to click and you can live a very different life if this ever happens.
One micro-lot is a hundredth of a standard lot, or 1,000 units of a currency. Despite its reputation, a micro-Forex account can be very useful even if you have enough trading capital for a standard account. It is much easier to implement conservative position sizing techniques with micro-lots. Some trading strategies require simultaneous creation of tens of market positions; in this case micro ... Micro lots are the smallest tradeable lot available to most brokers. A micro lot is a lot of 1,000 units of your account funding currency. If your account is funded in U.S. dollars, this means that a micro lot is $1,000 worth of the base currency you want to trade. If you are trading a dollar-based pair, 1 pip would be equal to 10 cents. Micro lots are very good for beginners that want ... For example, level 1 at $109.00 with a lot size of 0.01 (1 micro lot) has a total risk of $1,090 when it reaches zero. So when all the levels combined, the total risk is $35,800. This is the absolute loss that this grid structure will incur. You can’t lose more than this. Before the nano lot came into the picture (before a few years), micro lots were the smallest lot size a forex broker used to offer. The size of a Micro Lot in forex trading is 1000 units (1K units) of your account's currency. If you have a dollar-based account, then the average pip value of a forex micro lot is approximately 10 cents per pip. Micro lots are the smallest tradable lot. A micro lot is a portion of 1000 units of your accounting funding currency. If your account is financed in US dollars a micro lot is $1000 worth of the base currency you want to trade. If you are trading a dollar-based pair, 1 pip would be equal to 10 cents. Micro lots are very good for beginners. Nano ... Your Guide to Forex Lot Sizes: Mini, Micro, and Standard Lot. If you wish to trade the forex market, one of the first things you have to learn is the concept of lot size. The concept lies at the center of how you manage the risks involved in trading the forex market, which, in turn, determines your long-term success in the game. As you will get to realize later in this post, understanding and ... With choosing the best micro forex broker in mind, here we have listed six of the very best in the industry to select from. These forex trading brokers will all allow you the chance to trade in micro-lots which are 0.01 of a standard lot. This is a great option if you are looking for an opportunity to trade within a lower risk area. Although many brokers may claim to offer trading in micro ...
Click Here To Start Trading With Hugosway 👇https://www.hugosway.com/?cmp=3l0g1x2i&refid=2380 SUBSCRIBE FOR MORE VIDEOS LIKE THIS. ️https://www.youtube.com/c... Aggressive 1 minute FOREX scalping strategy. http://www.financial-spread-betting.com/course/technical-analysis.html PLEASE LIKE AND SHARE THIS VIDEO SO WE CAN D... The 4 forex strategies that every trader should know ! 🚨🚨Trading Performance 🚨🚨 Improve Your Trading Performance at our Fundamental Trading Academy https://w... CONTACT: EMAIL 👉[email protected] MENTORSHIP 👉 www.trendtrading.academy INSTAGRAM: JayTakeProfits 👉 https://www.instagram.com/jaytakeprofits/ (... The Easiest Forex STRATEGY! You must watch! 🙄 - Duration: 12:36. Top Traders 840,494 views. 12:36. The Top 5 Technical Indicators for Profitable Trading - Duration: 7:50. ... Super Free, Super Useful Forex Training - FREE Trend Trading Mini-Course - https://thetradingchannel.org/squeeze-page Training Courses EAP training program -... https://www.forexstrategysecrets.com Do you know of someone that makes a lot of pips but is still not making much money. This video will show you how to make...