More and more people want to try out Forex trading. It became apparent in the past year that you can profit from it. In fact, you can even start trading Forex for a living if you do enough research and take preventive measures. The internet made it possible for everyone to become a trader. Foreign exchange, known as Forex, is a decentralized market that operates solely on the internet, and it works 24/7. There’s a break on the weekend, so during that time, you can reevaluate what you did and what to look for in the week ahead.
If you have a smartphone or computer and some stable internet connection, you are good to go! Trading Forex is available for the masses, and it’s a tremendous economic evolution. In this article, we will talk about the fundamentals and what you need to check off your list if you aspire to trade Forex for a living.
Check Your Finances
Money management and rechecking how much attention you pay to every area is crucial before you even think about opening a trading account. Knowing the basics of savings and implementing them can save your trading account and improve your everyday spending. See how much you are spending daily. Where does your money seem to slip away? Pull out your credit card report if you are making purchases often, and you will probably be surprised.
Small things can add up and make a big chunk of unnecessary expenses. Buying your favorite coffee from a local shop is great, and you shouldn’t give it up if it makes you happy. Instead, try making coffee at home at least three times a week in the beginning, and then it will feel even more like a treat when you go to the coffee shop. Plus, you will start saving some money. Remember, small steps take you far. If you have more than one online tv subscription, do you have the time to watch all of that? Maybe you can share an account with a friend and cancel a subscription that you don’t even use that often.
Once you reorganize your finances, write down if you have any debts, and how much money you can invest without hurting your everyday life, then you are good to go. Remember, don’t invest more than you are comfortable with losing. In the end, you will trade currencies, so be mindful of the current ones you possess, so you can one day take care of everything you’ve accumulated through trading Forex. This way, you can prepare yourself for trading Forex for a living.
Finding a Broker
You certainly want to stay protected from scams. You can easily do it by checking broker reviews online and looking through regulated websites so you can find if the brokerage you are interested in is licensed and certified. However, you want to make sure you are working with experts. Naturally, nobody wants to get scammed, and the ones who do are usually the ones who didn’t want to bother much to research before opening a trading account with a company.
Trading Forex can be a great experience once you get to work with a broker that understands you, wants to explain what you don’t know, and can tell you if they think you are going to make a mistake by jumping into something completely new too quickly, etc. You will discuss your goals with them to devise a proper trading plan.
Forex Trading Strategies
Forex means you will do currency trading, whether crypto, regular, or exotic. Terms you will come across all the time are long or short timeframes. Beginners usually start with a strategy called “day trading.” It’s the simplest, and you don’t have to stress too much over everything. You don’t want to get overwhelmed before you even learn to trade properly. Depending on the current market position (long or short), here are the main strategies for beginners and intermediate Forex traders you should know about:
Scalping is a trading strategy that usually lasts a couple of minutes and is ideal for short-term trades. The idea is to beat the offer spread as quickly as possible, and its foundation is low time frame charts.
Day trading is something we already mentioned you should consider as a beginner. Trading forex like this means exiting a trade before the day ends. It relieves stress a lot since you won’t have to worry about what happens overnight and change the outcome. The trade usually lasts a couple of hours, making it super simple.
Swing trading implies holding a position for a few days. The aim is to make a profit using short-term price patterns, but it requires checking the bar every 30 minutes, making it stressful if you are not used to it yet.
Positional trading is a Forex trading strategy that helps you maximize profit by using significant price shifts to your advantage. It is ideal for patient traders; otherwise, you might act impulsively very quickly.
Trading Forex for a living is a real and possible thing, but it requires work and learning, like everything else. Be sure to ask about anything you are not sure about. Make sure to research, read books, listen to podcasts, or whatever is the best for you, as long as you continue to make progress. If you are consistently patient and listen to your broker (especially at the beginning), you will start trading Forex for a living in no time. Be sure to keep your job and do this as a side hustle until you are sure you have enough finances and are ready to leap. Good luck!