While at first, it seems like everyone wants to trade Forex because of the same reason, let’s think again. We are all interested in how it functions and how we can get money, but there is far more to that if you want to be a successful forex trader. It is well known that everything that seems easy takes a lot of effort in reality. It doesn’t mean you can’t make it. We are saying there is more to it than merely opening a trading account. We are here to explain to you Forex trading basics and guide you towards the necessary steps to become a profitable trader.
Decide on a goal
Studies show more than 80% of traders quit before they made a profit because they didn’t have a goal in mind. It can sound off at the beginning because everyone who wants to trade has a goal – to make money. It goes beyond that. When you think about it, if you were to aim for a bigger paycheck every year, but without thinking why you want to have more money, or not having a goal (living by yourself without any roommates, going on a trip you’ve been talking about for years, etc.). That money will make you happy temporarily. It will cut you some slack, but you won’t feel better. Initially, you will be happy you are more financially stable, but there will be no improvement in your quality of life because you didn’t set out any goal. You’ll spend money because you think you should, no matter what it’s for (usually instant happiness, such as an online shopping spree). It is why you should sit and think about what you would like to do with the money you can gradually accumulate by Forex trading. Is it to save more for your retirement fund, to have a passive income, or to stay in a different country for a couple of months and learn the language. Whatever the case is, a goal must have something “bigger” to think about when you are unsure if you will make it or are inclined to make rash forex trading decisions.
A trustworthy broker
It’s essential to avoid scams and find a broker you can trust and work with without any doubts. Scams are not so hard to avoid. You will have to do online research, but it shouldn’t take long. If you want to find yourself a regulated forex broker, broker reviews are the way to go. You can quickly check what they offer, their portfolio, and most importantly the client’s comments. Even if you already spoke to a broker and you think about sealing the deal, take your time to sit on it and check their online presence in the meanwhile. Any of their social media can tell you a lot about them. Every good broker has at least one social platform next to LinkedIn. If you barely find some legitimate info on the broker, it’s 99% a scam. Move on, recheck broker reviews. It’s essential to find someone you will feel comfortable talking about your finances and your trading goals. Checking the company is important too, so google up regulator websites since they have and update a list of regulated and licensed brokerages.
Now is the time to combine what we’ve learned above—your goal, your finances, and talking to your broker about it before you start forex trading. You can open a trading account, but take your time before you start trading because you don’t have to start right away with an immense amount of money (this is what every expert will tell you compared to scammers). A trading plan should include how much money you can invest without affecting your everyday life, and even if you lost it on the market, it wouldn’t crush you. You and your broker should figure out a plan that will align with your trader personality (although it will change with time). The last thing you want is to go overboard, so don’t be shy and share how much you can invest at the moment. If you are embarrassed, it will cost you a lot more in the future than you think. Going above your limits is not something you want to do in Forex. If you are not sure what you want to invest in, talk it out as well. While others may be interested solely in cryptos, and you think it could work for you – talk to your broker. You might find there are better options for what you want and the pace you want to go.
These might seem too simple, but they are the sole base of every profitable Forex trader. A large number of people don’t even check their broker’s credibility and end up without the money they invested. In a world where we are a click away from almost anything we want, sometimes it’s good to step back and take time to reevaluate things for yourself. It will benefit you more than just blindly going into Forex. Good luck!