How To Start Forex Trading
Trading is a type of group activity under it persons are busy in buying and selling for profit. The main aim of trading is make an exchange of one thing for another. Exchange and Transactions are the two important concept of Trading and is one need to understand these before starting trading.
Basic Definition of exchange is one person gives one thing to other person and the other person has to provide other thing having equal value. Exchange is a core concept of trading. For exchange five conditions must be satisfied:
Two Parties should be there
Each party has something that might be of value to the other party.
Communication and delivery is required by Each party
Acceptance or rejection of the offer is present for both parties
Both the party to have a believe to make a deal
How to start Trading:
It is a very important decision for trader because they invest their money and time. Therefore to makes it easy it is necessary that trader do everything step by step.
Steps to start trading:
Choose what market you want to trade
Watch the market
Keep a trading journal
Find or develop a trading strategy
Trade without risk
Start Investing Small Amount
Scale your trading
Know when not to trade
Choose what market you want to trade:
Every trader tries to trade everything. But it is very wrong decision. Very important rule of trading is be a specialist, don’t be a generalist.
Watch the markets:
Observation is very important step under it just by observation you will get various news about market which is helpful for your business development or profit maximization.
Keep a trading journal:
Trading journal is a written report of a trade. It is necessary that a trader keep journal even before he start trading under it they keep notes, ideas and observation in one place.
Find or develop a trading strategy:
A perfect planning is necessary for a perfect trade. It is necessary that the strategy should suit your trading style. You might start with widely-accepted principles of fundamental analysis and also read about technical analysis.
Trade without risk:
You need to first understand the risk behind trade and be aware that you may loose everything. Trading should be first practice by paper pen or using free trading tool
After practicing, begin trading in very small increment. You should trade amount that are negligible. Be sure to only trade with what you are willing to lose.
Scale your trading:
Once you experience consistent with small position, instead of trading more instruments just increase the number of shares for each position.
Make sure you always have capacity to exit an existing position in the event it moves against you suddenly.
Know when not trade:
It is not necessary that a trader always have a trading position. Cash also should be considered a position as well.